On 10/2, after I appeared with a very bullish message on CNBC’s “Closing Bell” show, the anchors Wilfred Frost and Morgan Brennan both looked at me and said – “wow, it is so nice to hear a bullish message.”  I remember how painful that call was because at the time the major equity indices were gapping lower on a worsening of the Trade War, a potential hard Brexit, the Hong Kong protests, and fear of Q4/18 market tank.  Despite those issues we expected a turn higher because our most sensitive tactical indicators showed the S&P 500 (SPX) had become washed out.


Today we posted our November Macro Slide Deck that shows that our core fundamental thesis remains positive into year-end and for our 2020 SPX target of 3350.  That said, we are expecting a minor pause in the upside for 3 reasons:

  1. We found since 1950 when SPX is up >20% ytd thru 10/31, it breaks that price 5/7 times by median 0.8%
  2. My pal at Sentimentrader.com found when SPX, Naz Comp, and DJIA print a record on same day for 1st time in more than 3 months, SPX is down 75% of time by median -0.8%
  3. Sentiment has clearly become more bullish as measured by the CBOE Volatility Index dropping to 12


Past performance is not a guarantee of future results. Index returns are unmanaged and do not reflect the deduction of any fees or expensesAll data points are sourced from Bloomberg as of 11/05/19 unless noted otherwise.

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