This is Turov on Timing for Friday, March 6, 2015.
The SPX advanced 2.51 points yesterday to close at 2101.04. TOT daily traders went 100% short at SPX 2096 and took a small loss by closing out the position on the close.
Since initiation of the Turov on Timing service on September 30, 1993, our daily trader recommendations have gained 15179.52 cumulative SPX points, compared to a gain of 1642.11 points in the index itself over the same period. That’s a ratio of 9.24 to one. (Please note that any day in which the daily model fails to outperform the SPX by at least a ratio of +9.24 to one, since that’s the ratio of outperformance already achieved, that ratio will decline.)
(The commentary in this paragraph last updated November 4, 2014) The super long term perspective 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). The current cyclical bull market is most likely to end in 2015 or 2016 (with the exact top a function of both unknowable politics and economics), with the primary bear market ending in 2020 or later, (once again, depending on unknowable economic and political events down the road). I continue to expect the market to suffer more pain before the primary bear market is over, some years in the future, at about the same Dow Jones 11,000 area as it traded in January 2000. I expect to see our new 2016-elected President have some very serious problems during his or her single term in office.
(The commentary in this paragraph last updated February 27, 2015.) The Intermediate Term Model remains bearish. Interestingly enough, historically, when the SPX has broken out to a new high after an extended period of mainly sideways movement, the breakout has usually been a fake-out, and the market has generally not moved significantly higher for a considerable period of time. This is often a time when the knee-jerk public buys, allowing professionals to unload high priced stocks. I doubt it will be different this time. The recent strength in all major market indices is more likely a sign of exhaustion, rather than of bullish confirmation. A major upside move this Winter is highly unlikely.
At the SPX close of 2101.04 yesterday, the daily model is neutral. However, if the SPX had managed to close above its daily high of 2104.25, the model would have been solidly bullish. I’m inclined to want to be cautious and on the sidelines if 2104.25 is not violated, but to be more aggressive if that level is breached. TOT daily traders are advised to go 400% long at SPX 2104.30 stop. If you go long, use a 1% protective sell stop on the position.
Futures are modestly lower in after-hours trading, and the resistance that prevented the SPX from closing strongly higher yesterday is likely to play against a move above 2104.30 today. But if the SPX moves above there, then an advance towards Monday’s closing level of 2117.39 should be easy. Then again, markets are rarely as “easy” as they “should” be.
Thanks for the opportunity to be of service, and I’ll email you again later today.
Turov on Timing is Copyright © 2015 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. 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 stop 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.