The SPX declined 2.97 points yesterday to close at 2172.47. TOT daily traders went 300% short at SPX 2175.32 and have held the position overnight and into today.
Since initiation of the Turov on Timing service on September 30, 1993, our daily trader recommendations have gained 16810.19 cumulative SPX points, compared to a gain of 1713.54 points in the index itself over the same period. That’s a ratio of 9.81 to one. (Please note that any day in which the daily model fails to outperform the SPX by at least a ratio of +9.81 to one, since that’s the ratio of outperformance already achieved, that ratio will decline.)
(The commentary in this paragraph last updated April 15, 2016) The super long term perspective (a prediction, not a forecast!) for the stock market remains bearish (as it has been since January 2000 after having been bullish for over 25 years, from December 1974 until then). I believe that, adjusted for REAL inflation (not the funny numbers the Social Security Administration uses) the stock market will be lower in real dollars in 2020 than it was in 2000. I also expect that our new 2016-elected President will have some very serious problems during his/her single term in office.
(The commentary in this paragraph last updated today.) Our most recent bearish call was clearly premature, and I do not expect a complete reversal of the market’s gain since this signal was generated; however we have seen at least a pause in the advance. I’ve been saying for a while, “If the market doesn’t crack very soon, then it might not crack at all.” Wednesday’s decline might be the first part of the “crack,” and there was no upside reversal yesterday A lot may depend on Friday’s news, currently a “known unknown.” While the Intermediate Term Model remains bearish, the Model could reverse if the market doesn’t have a real “crack” soon.
The daily model is VERY bearish today but indications are that the majority of the decline is likely to occur in the afternoon. This has nothing to do with Yellen’s speech, as my models are news-neutral. Acknowledging the uncertainty of the contents of the speech, I would consider standing aside today if it were not for the fact that the daily model is extremely bearish. Please note that that does NOT reflect the potential magnitude of any decline but rather is a reflection that the probability of a decline is significantly greater than the probability of an advance. And also please note that that does not imply that an advance is not possible – it certainly is – but rather that in a news-neutral environment the odds of a decline are far higher. Obviously, if Yellen says something that he market likes, then the market will advance, as significant news always trumps anybody’s model.
TOT daily traders come into today’s session 300% short from SPX 2175.32. Cover the position at an SPX 2175.32 breakeven stop, good through 10:45 a.m. If stopped out prior to 10:45, reestablish the 300% short position at the market at 10:45 a.m. If not stopped out prior to 10:45, hold the position and cancel the SPX 2175.32 stop. So one way or the other, the position at 10:45 will be short 300%. Basis the 10:45 a.m. price, use a 1% buy stop on the position, good for the balance of the day unless I issue an intraday update changing the stop.
Thanks for the opportunity to be of service and I’ll email you again later today.
Turov on Timing is Copyright © 2016 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.