This is Turov on Timing for Tuesday, November 28, 2006.
The SPX declined a whopping 19.05 points yesterday to close at 1381.90. TOT daily traders went 200% long at SPX 1402 last Monday and were stopped out at SPX 1392 yesterday. For once, I’m glad we had a stop in place.
Since initiation of the Turov on Timing service on September 30, 1993, our daily trader recommendations have gained 8867.84 cumulative SPX points, compared to a gain of 922.97 points in the index itself over the same period. That’s a ratio of 9.61 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.
Both the long and short term models remain neutral.
On yesterday’s hotline I said, “any surprising bad news definitely could send the market into a tailspin,” and “the market… is more vulnerable to news surprises than is usually the case.” However, we didn’t have any single big bit of bad news, but rather numerous small bits of bad news. Candidly, I’m surprised at the amount of carnage that the market succumbed to.
Despite the sharp decline, no major damage was done, and the market is just as likely to rebound after a day or two of uncertainty, as it is to decline further. As it was yesterday, the market is STILL more vulnerable to news surprises than is usually the case.
The daily model is neutral today, and we will remain on the sidelines.
Thanks for the opportunity to be of service, and I’ll email you again in 24 hours – or sooner if circumstances warrant.
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