We were having a very nice week until early Friday morning, when things fell apart. The jobs report came out, and the market seemed to like it. Stocks opened higher after the report, but something went very wrong shortly thereafter.
Despite the big losses on Friday, we actually posted modest gains for the week in the stock funds.
Here are the weekly, monthly, and annual TSP fund returns through Friday, April 4…
The good news is, the 20-day EMA held during Friday’s sell off. The bad news is, it produced what is called a negative outside reversal day, which can be trouble for any rally. Also, the rising wedge pattern (red) is quite apparent, and those are bearish formations, tending to break to the downside.
Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk
The Nasdaq 100, which is the top 100 tech stocks on the Nasdaq, took the brunt of Friday’s sell-off as investors dumped the high flying stocks like Facebook, Netflix, Tesla, to name a few. Take a look at the volume bar which shows how severe the selling was. About 5 times as many shares were traded on Friday compared to Thursday.
Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk
Sometimes big volume days can trigger the end of a big move, showing excessive emotions from traders. But there may have been something at work here more than just a typical Friday jobs report. Was this the revenge of the High Frequency Traders at work? I won’t get into it here, but I may delve into some conspiracy theories in Monday’s report.
Bonds rebounded as investors sought safety. This bond ETF has been trading in a fairly tight range for over two months now, hovering near the 20, 50, and 200-day EMA’s, and I have been just waiting to see which way it wants to break before considering an investment in the F-fund.
Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk
Good luck, thanks for reading! We will be back here next week with another TSP Wrap Up. You can read our daily market commentary at http://www.tsptalk.com/comments.html. If you need some help deciding what to do with your account, perhaps one of our premium services can help.
Tom Crowley
www.tsptalk.com
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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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