TSP Talk Blog

Stocks got a little relief on Thursday thanks to a reversal in the current trigger points for the market - yields, the dollar, and oil. The Dow gained 116-points and we saw larger gains in the broader indices with small caps leading again. The index charts are bouncing in convenient levels but as you'll see in the charts below, there has not been any change in trend in those triggering catalysts, making the rebound suspect at the moment.

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It was an interesting day of trading yesterday as the trio of the current bear triggering catalysts went in the bears' favor, yet stocks bounced back from deep session lows to close mixed, but mostly higher. Yields up, new highs. Dollar up, new highs. Oil up, new highs. That's an awful combination right now and even more confusing was that interest rate sensitive small caps led on the upside.

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Stocks fell sharply yesterday so once again there was no Turnaround Tuesday for the market, and another Monday rally gets sold. The Dow lost 388-points which was just slightly off the lows, and the S&P 500 held at its 200-day EMA, but that's about the only positives to mention after another September sell off. Bond yields, the dollar, and oil were all up on the day keeping the headwinds howling in front of the stock market.

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We saw a 4-day losing streak snap after yet another Monday rally. That's 12 positive Mondays in a row and counting, but another trend is that volume on these positive days has been lackluster suggesting that larger institutions are not doing the buying. Also, Tuesday through Friday has not been a picnic for the stock market lately. Yields and the dollar (UUP) continue to race higher, both making new highs for the year and the 10-year yield is now at a level not seen since 2007. Oil was down ...

Stocks were down modestly on Friday, but it was the failure of an early rally, and the dramatic selling in the final half hour that was concerning. The Dow lost 107-points and the Nasdaq was basically flat which, in comparison to recent days, wasn't all that bad, but again we are seeing selling of rallies right now, and the question is how long will that approach continue? Bonds rallied on a pullback in yields, which was helping the stock market early on until that late selling.

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