TSP Talk Weekly Wrap Up

Things got a bit choppy last week for stocks as the Cyprus news and the Fed got most of the headlines.

Here are the up to date TSP fund returns through March 22:

As we talked about last week, the week after options expiration week is generally weaker than a random week, and the minor losses this past week gave some short-term validation to the studies Trader Fred had done on options pre/post week trading. (Can you count the number of week / weaks that were in that sentence? 🙂

The S&P 500 found support at the 20-day EMA last week – holding about 3 times. This is a vey tricky time for the market as the short-term chart formations look bullish, sentiment has been mixed with our survey showing folks being too bearish (which is bullish), but some indicators are looking “toppy” and this recent daily back and forth action near the highs is a common occurrence just before a big move – but the direction isn’t necessarily clear.

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

This is the reason I am favoring a correction to the downside over another breakout to the upside, but momentum is up and investors have yet to give an indication that they are not willing to buy the dips.

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

But this news out of Cyprus, while seemingly benign to the U.S., may be the spark that triggers more concern here about worldwide economic conditions. The universal concern of course would be, if the Cyprian government can take bank depositors’ money right out of their bank account to help their desperate economic conditions, where else can they do that? In other Europeans countries? In the U.S.? So this developing story is not something that will be dismissed easily.

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

Tom Crowley
Weekly Wrap-Ups Archive
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The legal stuff: This information is for educational purposes only! This is not advice or are commendation. We do not give investment advice. Do not act on this data. Do not buy, sell or trade the funds mentioned herein based on this information. We may trade these funds differently than discussed above. We use additional methods and strategies to determine fund positions.

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