TSP Talk Blog

We are really starting to see the bear market percolate as stocks took another tumble on Friday capping off a very difficult week for the stock funds. The Dow lost 486-points but there was some late buying as the indices approached the June lows so perhaps this week we'll see some kind of oversold / double bottom rebound. Bonds were down as short term yield moved higher again.

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Admin note: Just a reminder that I am on vacation this week. I will check in every day but the commentaries will be brief because of some personal plans, and working on my laptop to me is like running in peanut butter compared to my PC. If something major happens I'll try to address that the best I can. My schedule will be completely off being in a different time zone so I'll apologize in advance, and appreciate your patience if I respond late to emails, or post reports and update the AutoTracker later than usual. Premium alerts will go out as needed.


There were several technical developments last week that are starting show the severity of the bear market, but we're also seeing signs of some downside extremes that could contribute to some short-term relief. The difficult part is knowing if a double bottom bounce is temporary, or something more sustainable like we saw in June. If the head and shoulders pattern can hold we could see a right shoulder develop, although there's no law that says it can't just break down now.




Some of the market leaders are failing so that could be a sign that the double bottom won't hold as the Transportation Index did breakdown last week, as did the price of oil which sounds like a good thing, but it may also be a sign of the market starting to price in a recession.

Aggressive investors might take a shot at a short term bounce but I don't have to remind you just how vulnerable the market is in this kind of environment as we wait for the next shoe to drop in the form of earnings estimate adjustments because of the higher interest rates.


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

Tom Crowley



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