The SPX declined 35.81 points yesterday to close at 2438.21. TOT daily traders were on the sidelines for the session and missed a lot of pain.
Since initiation of the Turov on Timing service on September 30, 1993, our daily trader recommendations have gained 17300.08 cumulative SPX points, compared to a gain of 1979.28 points in the index itself over the same period. That’s a ratio of 8.74 to one. (Please note that any day in which the daily trader recommendation fails to outperform the SPX by at least a ratio of +8.74 to one, since that’s the ratio of outperformance already achieved, that ratio will decline.)
(The commentary in this paragraph last updated August 1, 2017) The super long term perspective (a prediction, not a forecast!) for the stock market remains bearish (within the context of a medium term bull market). I believe that, adjusted for REAL inflation (not the funny numbers the Social Security Administration uses) the stock market may be lower in real dollars in 2020 than it was in 2000, although higher in nominal dollars. For a long time, I’ve been saying, “I also expect that our new 2016-elected President will have some very serious problems during his/her single term in office.” That belief stands, and we see it happening already.
(The commentary in this paragraph last updated August 1, 2017.) Despite the 1999 feel to the market, the Intermediate Term Model remains bearish. While the market could certainly move higher in the short run, by Labor Day I expect to see it lower than it is now. I do not believe such a decline will be the death knell for this medium term bull market, and it could well offer an opportunity for us to partake of the last phase of the bull market.
The daily model is bullish today, and the odds favor a rebound, even though we might see some follow-through selling early on. TOT daily trader are advised to go 300% long at SPX 2440 stop. If the SPX declines to 2436 before reaching 2440, lower the entry buy stop to SPX 2436, and for each additional 2 point decline, lower the entry buy stop by an equivalent 2 points. However, if the SPX is down on the day (i.e., below 2438.21) at 10:45 a.m., and you have not yet bought, consider the recommendation cancelled, and do not buy. If you have bought prior to 10:45, use a 1% protective sell stop on the position. However, if you have bought prior to 10:45, and if the SPX is down on the day (i.e., below 2438.21) at 10:45 a.m., sell the position at the market at that time and move to the sidelines. If still long as we approach the close, and if the SPX is below 2448, hold the position over the weekend and into Monday. If still long as we approach the close, and if the SPX is at or above 2448, take your profit on the close and go into the weekend flat.
UPDATE ON KOREA AND THE STOCK MARKET: I doubt anything substantive will happen over the weekend. August 15 (Tuesday here in the US; Monday night in Korea) is North Korea’ Independence Day, and that is the most likely time of NK’s next “surprise.” What concerns me most is something that has not made any webpage or newspaper I have seen: If NK has miniaturized a nuclear bomb for a rocket, then it is not far from duplicating that for a submarine. And even though NK’s subs are not even close to the sophistication of a US sub, if it gets close enough to its target, it doesn’t have to be state of the art. The odds are small that an old NK sub could cross the Pacific without being detected by a much more sophisticated sub-hunting US sub, but the odds were also small that the host of The Apprentice would become Commander in Chief of the United States military. I am concerned about a nuke on a sub, 15 miles out from the San Diego Naval Base (the largest on the West Coast and the second largest in the US, I believe) or the Port of Long Beach (the largest commercial port on the West Coast). A nuclear armed sub could lob a bomb into one of these places, if it did succeed in getting close enough, and we wouldn’t even know if it was NK doing it or a home grown terrorist with a dirty bomb. And if I have thought of this, the Joint Chiefs certainly have, also. Another reason why an “unthinkable” attack on NK might be less “unthinkable”. Just speculation though; I’ve never been invited to the Situation Room, and I don’t have the insight of the Joint Chiefs and their advisors.
Have a great weekend, thanks for the opportunity to be of service, and I’ll email you again before the start of Monday’s trading session – or sooner if circumstances warrant.
Turov on Timing is Copyright © 2017 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 including the fact that past performance is not a guarantee of future performance. Re-publication and distribution is strictly prohibited. No part may be reproduced without the permission of the Turov Investment Group Inc. All recommendations are based on the Standard & Poor’s cash index (SPX) which cannot be directly traded and Turov Investment Group Inc. makes no recommendation or suggestion to readers as to how SPX-based recommendations should be traded but rather leaves that to the discretion of each individual reader. The “official” price of the opening and closing SPX is as reported at www.bigcharts.com and may not be consistent with futures or ETF prices. All recommendations are based on that “official” price. Any recommendation that is to take place at a specific time is basis the “opening” on a one minute bar chart beginning at that time and ending one minute later. All times mentioned are Eastern. Questions related to this service should be directed to InvestmentAdvice@aol.com.