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TSP Talk Weekly Wrap Up

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A bumpy week in stock prices ends with mostly selling after potential trouble in trade negotiations Friday. Although the bears ended the S&P 500 weekly winning streak, it is not fair to say they are in control; but neither are the bulls. The trading action the last couple weeks has been in a flat trading range with a few extremities. It wasn't an eventless week. The Fed cut rates by a quarter percent and there was an attack on Saudi Arabian oil facilities. Both events initiated swings but a real direction could not be established.

Large cap indices are not far off the highs but (S&P 500) reversed twice after flirting with price ranges around the highs. Not an attractive attribute for investors currently on the fence. Stocks are up for September despite the poor seasonality of the month but there is not much to look forward to until earnings. This leaves room for about any news on trade, geopolitical matters, or economic status to easily move markets.

Bonds pivoted this week following its worst two weeks of the year. The attacks on oil facilities may not have broke apart the stock market but did add enough fear to investors to make bonds attractive again.

The F-fund led the TSP funds with a gain of 0.87%. The stock TSP funds were all down with the C-fund taking the greatest loss of 0.5%.




Here are the weekly, monthly, and annual TSP fund returns for the week ending September 20th:




The SPY (S&P 500 / C-fund) is having a more difficult time breaking above previously established highs than the action in late June. To be fair the new promise of rate cuts had stock investors very optimistic but the sharp sell off following the first rate cut now hangs over those investors heads. Investors felt entitled to the latest rate cut which made it less exciting. The next move for the index is in the air. The idea of an upcoming recession is not dead, there is an open gap to be filled below, and moving averages lurk below to be test for support. Those reason give me the impression stocks could let off some steam for the time being but like I said earlier, good news has the potential to drive this market higher even if it doesn't seem technically warranted. The C-fund was down 0.5% for the week.




The Dow Completion Index (S-fund) on the other hand has a little better technical picture, although the storyline may not look much better. The move to trade below the dotted red rising support was not great, but this index has room to rise without the pressure of rivaling previous highs and the latest action fits into a bull flag which tend to break to the upside. But again headlines will be the real deciding factor to how this index trades next week. The S-fund fell 0.44% for the week.




EFA (EAFE Index /I-fund) fell early in the week opening a trading gap but that gap was filled late in the week. The index closed at the lower price of that open gap so the losses remained. The I-fund ended down 0.34% for the week.




AGG (Bonds / F-fund) cut the losses of early September nearly in half this week. The oil attack in Saudi Arabia sent a shock wave of fear about the global economy which set the bond buying spree back in motion. The turn around came at a support line from the July lows. The index did get pushed back above its 20-day EMA by the end of Friday. The action at the moment does have a bear flag formation but the recent downside may be overpowered by the rising momentum of the rest of the year. The F-fund was up 0.87% for the week to lead the TSP funds but remains down 0.95% for September.




Good luck and thanks for reading. We will be back here next week with another TSP Wrap Up. You can read our daily market commentary at the Market Comments page. If you need more help deciding what to do with your account, perhaps one of our Premium Services can help.


Thomas A Crowley
www.tsptalk.com
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The legal stuff: This information is for educational purposes only! This is not advice or a recommendation. We do not give investment advice. Do not act on this data. Do not buy, sell or trade the funds mentioned herein based on this information. We may trade these funds differently than discussed above. We use additional methods and strategies to determine fund positions.

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Updated 09-23-2019 at 01:24 AM by TommyIV

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TSP Talk Weekly Wrap Ups

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