The SPX declined 5.12 points yesterday to close at 1280.08. TOT daily traders went 400% long shortly after Friday’s opening and have carried that position since then and into today.
Since initiation of this service on September 30, 1993, our daily trader recommendations have gained 8583.61 cumulative SPX points, compared to a gain of 821.15 points in the index itself over the same period.
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 long term model remains neutral, and the short term model remains bullish.
The market displayed its usual post-Fed-announcement volatility yesterday. Its 5 point decline was attributed by the pundits to fears of yet more increases in interest rates.
After the close, Google disappointed, and the stock tumbled over 50 points. As I write this commentary however, the S&P futures are down only about 0.4%, and the NASDAQ futures are down just a tad over 1%. Considering the Google shock, that’s rather contained, I think. It’s pretty obvious the market will probably open lower today, but in effect, that’s already history. What will matter is how the market acts after the gap opening. REMEMBER: If the public is selling in panic, it will be the specialists on the floor of the NYSE and the upstairs NASDAQ market makers who will be buying – and they are the most sophisticated investors that there are!
In any event, the news-neutral daily model remains bullish today. TOT daily traders come into today’s session 400% long. Maintain your position. So as not to get stopped out immediately on the opening by any panic selling, I recommend moving the sell stop back to where it was on Monday – SPX 1270 – and holding tight. I do this ever so rarely, and I’m sure there will be subscribers who are uncomfortable with this recommendation, but a lot of years of experience tells me that this is the proper percentage play. If the market rallies from the opening and stabilizes, I will update intraday with a raised stop recommendation. Otherwise, if not stopped out, carry your position overnight and into tomorrow.
One last comment: If the market is able to close in positive territory today, in other words, totally shrugging off the Google news, it will be VERY bullish for the balance of the week.
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 (c) 2006 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.