It was a mixed bag and a wild week for the TSP stock funds.  You wouldn’t know by looking at the daily closing numbers but, the intra-day price swings were huge this week.  In the end the C fund was up 1.73%, S fund up 1.67%, I fund down 1.91%, and F fund up 0.23%

This week we will do a summary of the daily charts and then a close look at the C and I funds intra-day.    The intra-day charts help to put big volatility days into perspective.  

Daily Charts  

The C fund made a short term high in mid-July and has been consolidating along its 10DMA and the 3200 price level ever since.  Friday’s price action was encouraging as the C fund closed at the top of the days trading range and above the 10DMA.  Also importantly, the slope of the 10DMA is flattening but still up.  We want to see the price stay above 3200 and the slope of the 10DMA positive.

The S fund has made 3 attempts at the 1500 level but can’t seem to close above it.  We are likely to see a strong break, one way or the other, in the next week or 2.  The technical indicators are flat and not helping us in determining the next likely price direction.

Like the S fund, the I fund is struggling with over-head resistance at 64.  Unlike the C and S funds, the I fund broke down hard on Friday following Thursday’s close below its 10DMA.  IF the I fund is leading, the C and S funds will roll over next week.  

Intra-Day

The TSP has 2 important rules (restrictions) that we must follow as TSP investors.  First, your reallocation must be made by 12:00PM EST to get that days closing price.  Second, you get 2 reallocations per calendar month.  Any additional reallocations can only increase your holdings in the G fund.  The first rule is important as it requires us to make a decision based on only a few hours of morning trade.  To help with this, we use intra-day charts to see shorter term patterns.

The 2 month 30 min chart of the C fund below shows significant volatility between 3200 and 3280 on an intra-day basis.  It also shows a clear break in the short term up trend that began in late June.  We are now in a horizontal consolidation which is relatively bullish.  Horizontal consolidations tend to resolve in the direction of the prior trend, which is up in this case.  IF the market breaks above 3280, we will likely to see another leg higher.  If the market closes below 3200, we are likely to see prices fall and retest 3000 at a minimum…

The I fund absolutely collapsed through its short term trend line with an A-B-C correction.  By the end of the day on Friday, the technical indicators had turned up from over sold levels.  This is a bullish pattern on an intra-day basis.  This set up SHOULD give us higher prices early next week.

Bottom Line:  On a daily basis, we are in a bit of a holding pattern.  The C fund looks to have found support at the 3200 level, a bullish sign.  The S fund has hit upside resistance at 1500 and can’t seem to get past it.  The I fund has clearly broken down.  The slope of its 10DMA is negative and its price is currently 2.5% below its 10DMA.  The divergence between the 3 funds will get resolved, one way or the other, within the next several days.  Stay tuned…

Have a great week!

Jerry