TSP Talk Weekly Wrap Up

It was an interesting week for the market. Trends driven by central bank decisions, front page tragedies, and a solid jobs report gave traders an opportunity to join the trend of the day. Post-holiday selling was followed by a positive start to the new month. The S&P 500 began to sell off at the open on Wednesday and then accelerate into the close after news of the massacre in California. The selling continued Thursday after the smaller than expected round of monetary stimulus from the ECB had the opposite affect of their intentions by rallying the euro against the dollar.

The November jobs report came out Friday with 211,000 jobs and unemployment at 5.0% exceeding expectation and further verifying a rate hike the Fed this month. Curiously, this sent the market up despite the reaction the previous day to the not dovish enough ECB. Whatever the driving force may have been, the S&P 500 came out nearly flat for the week.

With just a slight gain the C-fund led the TSP funds for the week while the S-fund lagged down more than 1%.

Here are the TSP fund returns for November:

The S-fund led the TSP funds for November and the I-fund lagged for the month.

Here are the weekly, monthly, and annual TSP fund returns for the week ending November 4th:

The SPY (S&P 500 / C-fund) has had trouble deciding if it would rather test the over-head resistance or the support below. The 200-day EMA below held as support in November but it may have been some help from the 50-day as support that kept the index from negative territory for the week. It seems market players are unsure how to feel as an increase in interest rates from the Fed is becoming inevitable. Probably because the initial reaction to the rate hike will be computer driven and traders will follow the money. The C-fund was nearly flat just up 0.12% this past week.

Although the Dow Completion Index (S-fund) was up Friday the boost was not enough to get out of negative territory this week. Rising support will wedge this index to test the overhead resistance if it can’t find its way before hand. An open gap lies below but the index has held off from filling the gap for 2 months. The S-fund was down 1.31% for the week.

The dollar posted its largest single day sell-off against the euro since march of 2009 Thursday. The ECB made their interest rate more negative to dissuade hording of money in banks to increase lending with intentions of lowering the value of the euro. However they did not lower the rate enough and the opposite occurred. Two gaps were filled in the sell-off leaving one open above.

EFA (EAFE Index / I-fund) fell below the apex of the pennant formation Thursday but closed back within on Friday. This index continues to move sideways keeping close to its 50-day EMA and neglecting the open gap below. The I-fund was down just 0.13% for the week.

AGG (Bonds / F-fund) had broken back above the old support that had been holding as resistance in November on Tuesday. However bonds also took a hit on Thursday but were able to get back above the 200-day EMA and move closer to the new open gap above on Friday. The F-fund was down 0.11% for the week.

Good luck and thanks for reading. We will be back here next week with another TSP Wrap Up.  You can read our daily market commentary at the Market Comments page. If you need more help deciding what to do with your account, perhaps one of our Premium Services can help.

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