TSP Talk – 11,000 & 115

Weekly TSP Wrap-up from TSP Talk

Stocks continued their bullish ways as many of the major indexes made new 52-week during the week. The U.S. market seem to be watching the employment numbers and the ongoing debt saga in Greece closely, and so far nothing overly negative has developed.

It was another good week for the TSP funds. The S-fund led the way with a gain of 2.56%, the C-fund was up 1.43%, and the I-fund added 0.46%. The F-fund (bonds) gained 0.08%, and the G-fund added 0.07%.

That strength gets April off to a good start as the S-fund now has a gain of 3.46% in the first six trading days of the month, the C-fund is next with +2.19%, and the I-fund is not far behind gaining 1.67% so far in April. The F-fund is slightly down at -0.06%, and the G-fund is up 0.08%.

The chart of the S&P 500 is looking very good as we are seeing consistent support and rebounds off of the ascending trendline. The big concern is that the index is quite extended to the upside and we are seeing that magic number of 115 again.

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

With the S&P 500 closing at 1184 on Friday, and the 200-day exponential moving average sitting at 1079, we now have a gap of 115 points between the two, and that has been an area where we have seen stocks take a break over the last several months. We talked about this a little more in Friday’s market commentary.

If you are in the stock funds now, you have probably done pretty well for yourself and while you may want to let some of it ride, you may want to consider locking in at least some profits. If you are not in the stock funds right now, I would caution you to avoid chasing at these levels.

Sure, the market can just keep soaring, but historically markets breathe in and out and you may want to wait for an exhale before committing any new money to stocks. Now that the Dow has touched that big bull’s eye at 11,000 on Friday, we may start to see that exhale.

Tom Crowley
www.tsptalk.com