This is Turov on Timing for Thursday, May 22, 2008.
The SPX declined 22.69 points yesterday to close at 1390.71. TOT daily traders came into the session 300% long but got out at SPX 1408 before any major damage was done.
On yesterday’s message, I said, “If the SPX fails to advance in the morning, then the selling should accelerate sharply during the balance of the day.” Indeed!!!!
Over the past 46 weeks, TOT daily traders have outperformed the SPX 30 times and underperformed 16 times. That’s a ratio of 1.88 to 1.
Since initiation of the Turov on Timing service on September 30, 1993, our daily trader recommendations have gained 10449.85 cumulative SPX points, compared to a gain of 931.78 points in the index itself over the same period. That’s a ratio of 11.21 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 bearish. Yesterday, I said, “I expect to see the SPX put up a gallant fight to stay above 1400, but when that level is breached to the downside, a waterfall decline is not out of the question.” We may have seen the beginning of that waterfall yesterday.
However, don’t expect to see more selling today, as the daily model is bullish. TOT daily traders are advised to go 400% long at SPX 1391 stop or at SPX 1387 limit, whichever comes first. If you go long, use an 8 point protective sell stop on the position. If the SPX advances by 8 points, then raise the stop to a breakeven. If still long on the close, carry your position overnight and into tomorrow.
Thanks for the opportunity to be of service, and I’ll email you again in 24 hours – or sooner if circumstances warrant.
Turov on Timing is Copyright © 2008 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.