Market Timing

Market Timing Models
Bears Fire a Shot as Risk Ratios Turn

The bears fired their first shot across the bow this week with sharp declines on Friday and Monday. The bulls were not in the mood to allow even a modest pullback and quickly stepped back into the market. Short-term, an oversold bounce after a 2.5% decline (Friday-Monday) is pretty normal stuff and does not change my overall thesis.

Market Timing Models – To Infinity and Beyond

Stocks turned a bit mixed the last two weeks, but the bulk of the evidence remains bullish, both long-term and short-term. Looking at the five biggest equal-weight sectors, we saw new highs in the EW Technology ETF (RYT), EW Industrials ETF (RGI) and EW Healthcare ETF (RYH) this week. Technology led in 2019 and continues to lead in 2020.

Market Timing Models – Short-term Test Awaits as Noise Levels Increase

It’s just the second trading day of 2020 and already the markets are setting up for a test. Stock futures are sharply lower as the S&P 500 looks set to open down around 1%. Gold, the Dollar and Treasury bonds are sharply higher as money looks for alternatives. A sharp decline in the S&P 500 could reverse the short-term uptrend and herald the much awaited correction.

Market Timing Models – S&P 500 is Extended, but not Yet Frothy

There is not much change in the broad market picture. The S&P 500 SPDR hit a new high again this week and extended its uptrend. The long-term trend has been up since February and SPY has been on a tear since early October. Barring a 2.22 point decline today (Friday), the S&P 500 SPDR is set to close higher for 11 of the last 12 weeks. It is an extraordinary run (+9.71% since early October), and shows no signs of slowing.

Market Timing Models – History does not Repeat itself, but it Often Rhymes.

Today’s report will focus on the S&P 500, the current advance and a future scenario. I am focused on the S&P 500, and SPY by extension, because this index is the driving force in the stock market. It accounts for some 80% of the US equity market and is the most widely followed benchmark for US stocks. Small-caps and mid-caps are more likely to follow the S&P 500, not the other way around.

Market Timing Model Update and A Few Things NOT to Worry About

The S&P 500 SPDR was never in trouble this year and the Russell 2000 ETF was never up less than 8% year-to-date. Small-caps surged out of the gate with IWM gaining around 17% the first two months of the year. This amalgamation of 2000 stocks then embarked on a long consolidation with a slight downward bias the next six months.

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