TSP Talk Blog

The Dow was down 86-points, but you'd have to look pretty hard to find anything else that was down yesterday. S&P and Nasdaq - up. Small caps and I-fund - up. Bonds - up. Gold, silver, copper - up. Oil, lumber, bitcoin - up, up, up. One of the main reasons everything was up was because one key drivers was down hard -- the dollar. No closing highs for the S&P 500 yet, but the Nasdaq did make another new high.

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It was a change to see both the Nasdaq and the small caps put together sold gains on the same day. They had been doing a little back and forth thing for a while. Yesterday only the Dow, and to some extent the Transports, decided to not participate in the rally.

The big question once again is whether the S&P 500 is going to make a new high. Not just make a new high, but breakout and hold any new highs. It's possible with the momentum we could see an attempted breakout, but the recent flat top and inability of the bull to push it past that finish line may be getting into their heads. The bears haven't been able to do much except hold things near resistance, but at some point, if the bulls can't make a move, the bears will.

The dollar has been coming down steadily since the COVID outbreak fiasco, but it is now testing some possible support at the 200-day average, and the rising support line off the prior lows. If this can hold things might get a little tougher for the stock market - and metals. A breakdown would mean more of the same -- buoyancy on most prices.




Bonds, which have been falling precipitously for the last week or so, rallied nicely after finding support at a major moving average.

The news front has been quiet, as has been the trading on Wall Street, so the market awaits its next catalyst.

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The S&P 500 (C-fund) tickled the old highs again, but for a 5th straight day they came up just short. So, the flat top formation ("Oscarism") continues, and that is a generally bearish formation that can precede pullbacks, but of course nothing works all of the time. The rising trend and trading channel are still very much intact but that double top, and now the flat top, are trying to derail that.




The DWCPF (S-fund) had a big day and small caps continue to rise along the rising support line after breaking through resistance earlier this month.




The year to date chart of DWCPF shows that the large open gap from February has already been closed, so it is now en route to try to test the February highs.




The EAFE (I-fund) rallied holding off that rising support line, and the old resistance line, and once again is flirting with new highs




BND (Bond ETF / F-fund) bounced off the 50-day EMA, and while it was due for some relief, the questions is whether this can rally back with any authority - at least up to the 20-day EMA, if not the open gap near 89.25, or if the free fall will resume.




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Thanks for reading. We'll see you back here tomorrow.

Tom Crowley



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