This is Turov on Timing for Monday, November 27, 2006.
The SPX advanced 3.28 points on Wednesday and then declined 5.14 points Friday to close at 1400.95. TOT daily traders went 200% long at SPX 1402 on last Monday and have held the position since then.
Since initiation of the Turov on Timing service on September 30, 1993, our daily trader recommendations have gained 8885.74 cumulative SPX points, compared to a gain of 942.02 points in the index itself over the same period. That’s a ratio of 9.43 to one.
The super long term perspective for the stock market remains bearish (as it has been since January 2000), and it’s unlikely anything will change that for several years.
Both the long and short term models remain neutral.
The market did a good job of working off some excessive exuberance last week by moving sideways. On the other hand, it was a rather poor Thanksgiving week performance.
The daily model is modestly bullish today, and we will maintain our modestly bullish position. TOT daily traders come into today’s session 200% long. Maintain the position and the same 1392 stop. On the upside, if the SPX rallies to 1412, take your profit. So we’re risking 20 cumulative points to make 20 cumulative points – BUT the odds of an advance are much greater than the odds of a decline. If neither limit nor stop is reached, carry the position overnight and into tomorrow.
While the market is clearly overbought – albeit somewhat less so than a week ago because of last week’s sideways movement – the potential nevertheless exists for an explosive upside blowoff if there’s any surprising good news. On the other hand, after the recent sharp advance, any surprising bad news definitely could send the market into a tailspin. I suppose what I’m really saying is that while the probability is still that the market will move higher, it is more vulnerable to news surprises than is usually the case.
Thanks for the opportunity to be of service, and I’ll email you again in 24 hours – or sooner if circumstances warrant.
Turov on Timing is Copyright © 2006 by Turov Investment Group Inc. All rights reserved. Turov on Timing is for personal use only. All caveats and advisories that appear in the monthly Turov on Timing apply equally to this email. Re-publication and distribution is strictly prohibited. No part may be reproduced without the permission of the Turov Investment Group Inc.