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TSP Talk Weekly Wrap Up

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Stocks were mixed for the week. There was more rotation from large caps to small caps than overall selling. Momentum was slowed in the over extended large cap names which can be looked at as a healthy move going forward if not a potential entry point for those who aren't willing to buy indices at their highs. Bank earnings started to be released Friday and investors were quick to sell their financial holdings which added weight to the large cap price.

There was also a potential sell the news reaction to Biden's stimulus proposal. Investors have loved free money to stimulate the economy and stock prices. Its all speculation as to why the indices fell merely because anything logical can fit after the fact but really its difficult to know the thought process of the masses by asking a handful of investors why they sold or thought others sold. A possibility could be the potential for higher taxes down the road to pay back the stimulus costs. Another possibility were markets just need to a sigh of relief as pressure built after over extension. There are far too many factors above even news reports, the dollar's value, and bond markets to make sense of why anything happen in such a large market.

What does matter is your willingness to 'own' what is happening around you. We all want to increase our portfolios but the approach may be better off if you take a step back from the nickel and dime process but rather consider if you want to own a piece of these funds at the price given. Your perspective is yours and I'm not giving mine outright but my analogy would be if you were willing to buy a beautiful house that you know will eventually fall off the cliff it sits if you thought you could resell it before it falls. My point is that numbers are one thing but true value is another.

More earnings are coming next week so be prepared to find your entry or exit points.

Bonds were up for the week as well.




Here are the weekly, monthly, and annual TSP fund returns for the week ending January 15:




The SPY (S&P 500 / C-fund) was down early in the week and trading was relatively quiet and flat from there until the index sold off Friday with bank stocks and hit its lows and the 20-day EMA. The C-fund lagged the other TSP funds with a 1.46% loss for the week. The index remains in positive territory for the month.




The Dow Completion Index (S-fund) outperformed the TSP funds for the week as investors moved money out of large caps and into small cap companies. The index fell off its high Friday that was even with the rising trend line that has been resistance in January. The S-fund ended the week with a 0.82% gain.




EFA (EAFE Index / I-fund) fell to start the week and slowly climbed back to the previous weeks high through Thursday. The index gapped down Friday where it found its lows were just about par with the 20-day EMA. EFA ended the week down 1.36% and left an open gap above the current price.




AGG (Bonds / F-fund) slipped further to begin the week and officially closed the open gap from November on Tuesday where the index reversed off its lows and eventually closed at its highs at the top of the open gap. The following day the index jumped back above it 20 and 50-day EMAs but quickly pulled back. The index ended below its highs for the week but did gain 0.19% while closing a long standing open gap.




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
Weekly Wrap-Ups Archive
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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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S&P500 (C Fund) (delayed)

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DWCPF (S Fund) (delayed)

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EFA (I Fund) (delayed)

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BND (F Fund) (delayed)

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