The S&P 500 closed at 4280 on Friday, making it four straight up weeks. Before the opening bell on Wednesday, the July Consumer Price Index (CPI) slowed to 8.5%, down from the over 40-year high of 9.1% hit in June. As a result, the S&P 500 had a strong bullish day gaining over 2%. Thursdays Producer Price Index (PPI) also reversed to the downside. Those two numbers then lifted the S&P 500 above two key technical levels. First, the S&P 500 broke above the 2 June 4177 resistance level. And second, the S&P 500 crossed the significant 50% retracement level. On 3 Jan of this year, the S&P 500 set a new record high of 4796. The subsequent low was 3666 on 16 June. The halfway point between the two was 4231, and the S&P 500 closed above that on Friday. In data going back to 1950, the S&P has never returned to its low after closing above a 50% retracement. Next week the housing numbers will drive the markets. For TSP TIPS, all three equity funds (C, S, I) now have positive Performance Rankings with the S and C funds in the top two positions respectively. As such, we are recommending the following reallocation.
The S&P 500 closed at 4280 on Friday, making it four straight up weeks. Before the opening bell on Wednesday, the July Consumer Price Index (CPI) slowed to 8.5%, down from the over 40-year high of 9.1% hit in June. As a result, the S&P 500 had a strong bullish day gaining over 2%. Thursdays Producer Price Index (PPI) also reversed to the downside. Those two numbers then lifted the S&P 500 above two key technical levels. First, the S&P 500 broke above the 2 June 4177 resistance level. And second, the S&P 500 crossed the significant 50% retracement level. On 3 Jan of this year, the S&P 500 set a new record high of 4796. The subsequent low was 3666 on 16 June. The halfway point between the two was 4231, and the S&P 500 closed above that on Friday. In data going back to 1950, the S&P has never returned to its low after closing above a 50% retracement. Next week the housing numbers will drive the markets. For TSP TIPS, all three equity funds (C, S, I) now have positive Performance Rankings with the S and C funds in the top two positions respectively. As such, we are recommending the following reallocation.