Trader’s Wire Market Update for Tuesday, April 18, 2017 – TheTradersWire

Trader’s Wire Market Update for Tuesday, April 18, 2017

Trader’s Wire Market Update for Tuesday, April 18, 2017

The SPX advanced 20.06 points yesterday to close at 2349.01.  TOT daily traders came into the session 300% long and had a gain on the day of 60.18 cumulative points, selling the position on the close.

Since initiation of the Turov on Timing service on September 30, 1993, our daily trader recommendations have gained 17147.87 cumulative SPX points, compared to a gain of 1890.08 pointsin the index itself over the same period.  That’s a ratio of 9.07 to one.  (Please note that any day in which the daily model fails to outperform the SPX by at least a ratio of +9.07 to one, since that’s the ratio of outperformance already achieved, that ratio will decline.)

(The commentary in this paragraph last updated November 10, 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.  For a long time, I’ve been saying, “I also expect that our new 2016-elected President will have some very serious problems during his/her single term in office.”  That belief stands.

(The commentary in this paragraph last updated March 24, 2017.)  The Intermediate Term Model remains bullish.  This does not mean the bull market is without risk.  It does mean that the odds favor the next 50 point move in the SPX is more likely to be up to about 2400 than down to 2300.

We have an interesting situation today.  One important thing that TIG does is to compartmentalize market activity into analyzable components.  Slicing the onion (compartmentalizing) broadly, there are 102 cases which are indicative of tomorrow’s most likely direction, and the net result is pretty neutral.  Slicing it thinner, and the result is slightly bullish (which corresponds nicely with the general tendency for the market to advance on Tax Day).  But slicing it still thinner results in a mere five cases, ALL of which saw the market decline, and three of those five were sharp declines.  Such a discrepancy is highly unusual.  So is the daily model bullish or bearish?  My best guess (intelligent or otherwise) is bearish… BUT I don’t have a lot of confidence in a statistical universe of only five – especially considering that a less precisely sliced onion would be bullish.  The bearish argument is that a ratio of 0:5 is impressive.  However, considering that since TOT started in 1993, 42.3% of the market’s entire 1890.08 net SPX point advance occurred on Tuesdays (799.73 cumulative net SPX points) AND the strong upward bias on Tax Day, going short is not compelling.  We will stand aside, watching and learning.

 

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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