TommyIV's TSP Talk Blog

Seasonal bias went in the bulls' favor as expected. It was a typical low volume week that started slow and a bit directionless Monday. But the gains for the week were really put in motion on Tuesday when prices rose mostly uncontested all day for stock indices. Volatility picked up Wednesday, but the bulls reclaimed lost gains by the end of the day. The shortened trading Friday was quiet, and the price range was the smallest we've seen this year.

So, with momentum still on the bulls' side we look forward and think about whether this can hold through December. The holiday seasonality is a contributing factor. The recent gains leading into holiday season may provoke more buyers to get in on the action expected from the Santa Claus rally. But the market still faces high inflation which may affect retail spending, along with the Fed who is actively tightening monetary policy. Jerome Powell is scheduled to speak publicly on Thursday. Investors want confirmation in their belief that the Fed will slow its pace of rate hikes. Powell is typically good at not saying exactly what they want to hear.

Deeper into December we will see the last CPI report of the year following last month's that suggested inflation has peaked. Any move off that course will have a profound effect on the market. The FOMC meeting actually begins the day the next CPI report is released. That may play a large role in their rate decision.

The I-fund has led the TSP stock funds for a fourth straight week. The F-fund continues its stretch higher.


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Here are the weekly, monthly, and annual TSP fund returns for the week ending November 25:




SPY (S&P 500 / C-fund) advanced above its 200-day EMA in the last two trading days of the week. The ETF had not traded a full day above its 200-day EMA since August. The next technical obstacle was the open gap from September. We tend to talk about open gaps as a destination for prices. But sometimes the longer term open gaps can have their own psychological effect that may have them acting as resistance, especially in a bear market where short-term buyers are looking for an escape from exposure during a bear market. That may or may not be the case but the light volume of the market on Friday kept us from seeing a real move away from the open gap or to filling the open gap. The C-fund ended the week with a gain of 1.55%.




The Dow Completion Index (S-fund) remained out of reach of both its 200-day EMA and its own open gap from September. The S-fund has lagged in performance this week after coming out as the only losing fund the previous week. The price is sandwiched between to open gaps now but there will be some moving averages tested again for support if the bottom gap is filled soon. The S-fund gained 1.40% this week.




The I-fund (EAFE Index /EFA) has now led the TSP stock funds for the fourth straight week. EFA's prices reached higher this week and ended near its highs for the week on Friday about even with the highs of August. The question now is if that price can rise past that August highs or if investors will start taking profits. There is another peak from early June that could be tested shortly after if the current price exceeds the August highs.




BND (Bonds / F-fund) has kept with its recent character change. The ETF rose further away from the 50-day EMA and the open gap left behind earlier this month. The F-fund rose 1.15% this week which added to the fund's November return which now sits at 3.59% which currently outperforms the S-fund for November.




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

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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.