This is Turov on Timing for Monday, December 13, 2010.
After a stellar first week of December, TOT daily traders had a rough time of it last week, giving back 26.5% of the prior week’s gains. On Friday, the SPX advanced 7.4 points to close at 1240.40. TOT daily traders had a loss on a short position. We are currently flat.
Since initiation of the Turov on Timing service on September 30, 1993, our daily trader recommendations have gained 12136.40 cumulative SPX points, compared to a gain of 781.47 points in the index itself over the same period. That’s a ratio of 15.53 to one.
The super long term perspective for the stock market remains bearish (as it has been since January 2000 after having been bullish from December 1974 until then). When the current cyclical bull market ends, expect another nasty crash to perhaps finally bring an end to the long term bear market that began in 2000.
Despite the Intermediate Term Model having clearly been premature in turning bearish, the model still remains bearish. Although excessive bullish sentiment was not a factor in its turning bearish, it now is a significant reason for its remaining bearish.
The directional component of the daily model is bearish today, but the risk component is quite high for the SPX. We will stand aside from trading the SPX until the risk component is in safer territory.
Thanks for the opportunity to be of service, and I’ll email you again six hours before the start of tomorrow’s session – or sooner if circumstances warrant.
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