The SPX advanced 0.42 point yesterday to close at 2047.63. TOT daily traders went 200% short on Tuesday’s opening and have held the position overnight twice and into today. On a day similar to today, in 1983 or 1984, I believe, Peter Jennings reported on the ABC evening news (something like), “The stock market was quiet today, with the Dow Jones Index up less than one point.” I contacted Peter and pointed out that while the market was little changed on the day, it had had huge intraday swings. He said he would look into it, and on the next day’s news, he “corrected” the previous day’s reporting. (I didn’t ask what happened to the news-writer who prepared the news for Peter!) Yesterday was such a day, with the major indices vacillating widely, with both big advances and big declines, ending up with little change. While Macbeth might have said, it was a day “full of sound and fury, signifying nothing,” I believe the day signified the continuing inability of the market to fend off selling pressures except in certain sectors, most notable financial stocks (e.g., Bank of America was up almost 5% yesterday). And many small cap stocks did considerably better than most blue chips.
A little housekeeping: On Wednesday’s TOT, I reported that the SPX declined 19.25 points on Tuesday (TOT daily traders were short) but the actual reported number should have been 19.45.
Since initiation of the Turov on Timing service on September 30, 1993, our daily trader recommendations have gained 16718.53 cumulative SPX points, compared to a gain of 1588.70 points in the index itself over the same period. That’s a ratio of 10.52 to one. (Please note that any day in which the daily model fails to outperform the SPX by at least a ratio of +10.52 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 May 4, 2016.) The Intermediate Term Model has been bearish since the close on May 2 (SPX 2081.43), and it remains so.
I expect weakness to continue in the early going, but after that the selling might take a breather. Continue to hold the short position and the SPX 2061 buy stop for the time being. If the SPX declines to 2040, lower the stop to SPX 2050, and for each additional 5 point decline after that, if it occurs, lower the stop by an equivalent 5 points. If still short as we approach the close, take your profit on the close as the probability of Friday’s daily model being bullish is rather high.
Thanks for the opportunity to be of service and I’ll email you again in 24 hours.
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