TSP Talk Blog

Several economic reports came out on Wednesday morning and stocks were not looking good when the opening bell rang, but we did see some typical light volume bullish holiday trading afterward and the indices moved up for most of the day and closed at the highs of the day. The Dow closed off the lows but still ended the day with a small loss, but most of the broader indices did well. Small caps led, bonds were up, yields down, and the dollar continues to move higher putting pressure on the I-fund.

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The initial jobless claims report beat estimates, coming in stronger than expected, and that initially put some pressure on the futures before the opening bell as investors are sensing the need for the Fed to act on interest rates. Later in the afternoon the Fed Meeting minutes were released and it basically confirmed that they are preparing.

Technically, we saw another reversal on the S&P 500 (C-fund) chart - this one positive after Monday's negative reversal. The result looks like some kind of bullish flag, but trading around the holidays can make for deceptive action. That peak on Monday could get ignored, or it could turn into some kind of meaningful top. Seasonality gets a little worse for stocks next week, but 2021 hasn't been a typical year in following seasonal patterns, so I'm not sure we can count on a typical result.




The DWCPF (S-fund) had a very nice day on Wednesday despite some heavy selling to start the day. It tested Tuesday's low and held, and I'd say that is a bullish sign, but again, holiday action isn't always what it appears to be with trading volume reduced quite a bit. The large open gap that we have been watching is still only partially filled so the chart is only partially satisfied.




As I mentioned on Wednesday, this is going to be a quick commentary. I hope everyone enjoyed their Thanksgiving. If you're interested, RevShark (aka, James Deporre), who is one of our premium service providers since 2006, posted his annual Thanksgiving story in the Blog area.

Today is a shortened session for the stock market, but the TSP is open with the normal deadline.

Update: So much for a quiet, bullish biased day. The futures are tanking on Thursday night over a new COVID variant. Here we go again?

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Thanks for reading. Have a great weekend!

Tom Crowley

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