This is Turov on Timing for Wednesday, May 21, 2008.
The SPX declined 13.23 points yesterday to close at 1413.40. TOT daily traders went 300% long at SPX 1417 and have held the position overnight and into today. Interestingly enough, while the SPX was declining, during the same period, the NASDAQ 100 was advancing.
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 10466.05 cumulative SPX points, compared to a gain of 954.47 points in the index itself over the same period. That’s a ratio of 10.97 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. 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.
Despite the modest decline in futures prices as I write this, I expect to see the SPX rise in the morning. If it does, expect a modest additional advance in the afternoon. On the other hand, if the SPX fails to advance in the morning, then the selling should accelerate sharply during the balance of the day. Maintain your 300% long position for the time being with a sell stop at SPX 1402.83. I’ll update again between 10:45 and 10:55 a.m.
Thanks for the opportunity to be of service, and I’ll email you again in a few hours – or sooner if circumstances warrant.
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