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TSP Talk – Dip in Stocks

Stocks saw modest losses last week, but the upside trends remain intact. We’re entering earnings warnings season so next week, the last week in March, tends to be a little bumpy.

For the TSP, the C-fund lost 0.49% last week, the S-fund dropped 0.42%, the I-fund fell 1.48%, while the F-fund (bonds) added 0.22% and the G-fund was up 0.03%.

For March, the C-fund is now up 2.43%, the S-fund has gained 1.96%,the I-fund has made 0.08%, the F-fund has lost 0.73%, and the G-fund has added 0.10%.

The pullback in the S&P 500 saw the index dip back below the middle trendline again so it it looks like it may become inconsequential going forward, and the parallel trading channel between the upper and lower rising trend lines, which has remained intact since the December low. The 20-day EMA will also focus some attention from traders and investors looking for support to hold.


Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk


The bond market has experienced a little bounce after the recent sell-off. Looking at the TLT, the exchange traded fund of the
20-year bond, we can see a clear rounded top formation, and the breakdown below the 115 level could be the sign that the bull market in bonds may be over. I am hearing many folks talk about this end of the bull market in bonds so the surprise would be if the 200-day EMA holds and the upside resumes. I am not calling it either way yet, but we know how markets likes to do whatever it takes to make the most people wrong.


Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk

The old support level at 115, should now act as resistance if this bounce continues this coming week, so that will be an interesting test.

Earnings season for the stock market will kick in in a couple of weeks so the in the interim, we should start hearing the earnings warnings from companies who want to prepare investors. That’s one reason why the last week of March is historically weaker than the first part of the month.

Good luck, and thanks for reading. We will be back here next week with another TSP Wrap Up.

Tom Crowley
www.tsptalk.com
Weekly Wrap-Ups Archive
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