This is Turov on Timing for Friday, February 1, 2008.
The SPX advanced 22.74 points yesterday to close at 1378.55. TOT daily traders got whipsawed both long and short and then went 200% long on the close, carrying that position overnight and into today.
TOT daily traders have outperformed the SPX in 20 of the past 30 weeks but are behind so far this week.
Since initiation of the Turov on Timing service on September 30, 1993, our daily trader recommendations have gained 10088.69 cumulative SPX points, compared to a gain of 919.62 points in the index itself over the same period. That’s a ratio of 10.97 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.
The intermediate term model remains bullish. The SPX has advanced 40 points, or about 3%, since the intermediate term model issued its “buy signal”. I would not be surprised if the total move stalled just a percent or two above current levels.
The past two days has been the story of MBIA. On Wednesday, when the market was soaring, CNBC issued a story about MBIA which caused the stock to swoon, taking the entire market with it. And then, Tuesday morning, as the swoon continued, MBIA issued a press release of perfumed roses, and the market responded by recapturing all the ground it had lost. In the moment, it’s frustrating to see exogenous random news mess up our reasoned position. In the long term, however, such exogenous random news evens out, balancing unpleasant surprises with pleasant ones. The problem is, while our brains may perceive the long term, our emotions live almost exclusively in the present moment.
Anyway, in the present moment, the daily model is bullish today. However, with the negative news from Google after the close yesterday, early morning softness is to be expected. TOT daily traders come into today’s session 200% long. I want to increase that position, but I’d prefer to see some stabilization in the response to the Google news before doing so. So, I’ll be monitoring my intraday model carefully and when it signals a clear “go ahead”, I’ll update with an interim report. Also, for the time being, use no stop on your long position; once again, if I think a stop is warranted, I’ll update with an interim report.
Thanks for the opportunity to be of service, and I’ll email you again in a few hours.
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