This is Turov on Timing for Thursday, December 23, 2010.
The SPX advanced 4.24 points yesterday to close at 1258.84. TOT daily traders went 300% long at SPX 1256 and took our profit on the close. We are currently flat.
Since initiation of the Turov on Timing service on September 30, 1993, our daily trader recommendations have gained 12144.86 cumulative SPX points, compared to a gain of 799.91 points in the index itself over the same period. That’s a ratio of 15.18 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. However, the odds are increasing rapidly that this overbought condition can get more extreme before it corrects, and the chances of an improvement in the Model are increasing – irrespective of my being rather unhappy at that possibility.
Despite the favorable seasonality of pre-Christmas trading, the daily model is bearish today. In fact, the odds are about 3:2 that we will see the market decline today. TOT daily traders are advised to go 300% short at SPX 1259.50 limit or at SPX 1258.50 stop, whichever comes first. Once you go short, use a 1% protective buy stop on the position. If not stopped out prior to the close, cover the short on the close and go into the holiday weekend flat.
Have a Merry Christmas (or just a pleasant day off, depending on your religious persuasion), thanks for the opportunity to be of service, and I’ll email you again six hours before the start of Monday’s session – or sooner if circumstances warrant.
Turov on Timing is Copyright © 2010 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.