TommyIV's TSP Talk Blog

TSP funds finished their third straight week of gains in every fund. Large cap funds continue to produce new highs while bond yields are settling lower. Traders are still buying good news and this week is was a good start to earnings season from the financial sectors all while a couple positive economic reports came out including a drop in jobless claims. The worry going forward is if the market is setting up for a sell the news reaction or even if a lack of good news even without bad news in its place will set off the chain of profit taking. Its certainly possible for this action to carry on but it will end eventually and the extent to which it gets carried away will dictate the magnitude of the correction.

Unreasonable, illogical, wall of worry; this is the best way to discuss large cap action but the losers have been those who have already retreated. There is a call for correction by analysts, and its to keep the markets honest. A fraction of the total companies are carrying the index prices that the TSP funds follow but there is so much not reflected under the surface. But why should we care? We only get the benefits rising indices. Well of course we should care because we have limited time and trades when we want to get out. Holding stocks and ETFs usually gives you the ability to set up stops and to get in and out quickly. Without this luxury in TSP funds we have to be careful and protect this capital produced so easily. The other option is plan not to make a move in the case of a pull back, except for maybe buy more if possible and hope we get another 2020 type of year where gains are effortless.

New highs were produced in the C-fund this week but the index lagged the other TSP stock funds. All three were up around 1.5% this week with the I-fund leading at a 1.67% gain. Bond prices continue to climb out the hole the fell into starting two months ago.

More earnings next week will be the focus.




Here are the weekly, monthly, and annual TSP fund returns for the week ending April 16:




The SPY (S&P 500 / C-fund) have been relentless this month and have steadily climb higher to new highs time and time again. Volatility has been low for stocks which is a nice when combined continued growth. Of course this is not sustainable but its nice while it lasts. The open gap from the beginning of will be a sure target once the index pulls back for a rest. The C-fund was up 1.39% for the week.




The Dow Completion Index (S-fund) broke above a falling trend mid-week and held to close above it the last couple trading days. The S-fund outperformed over the C-fund for most of last year's recovery and still has gained more in 2021 (12.24%). But the chart gives me less anxiety than SPY's current technical set up. The question is whether these indices will react together or if rotation will cause a divergent going forward. The S-fund was up 1.4% for the week.




EFA (EAFE Index / I-fund) outperformed the TSP funds for the week but credit must be given to the recent weakness in the U.S. dollar. EFA has not only broken through resistance but continues to reach new highs like SPY. Easy money is always attractive until its not. The I-fund was up 1.67% for the week.




BND (Bonds / F-fund) pulled back from its highs Thursday but managed to remain in the green for the week. A trading day above the 50-day EMA stands alone and the index was back between the 20 and 50-day EMA Friday like Thursday never happened. The F-fund was up 0.35% for the week putting it up 0.85% for April.





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.