Our end of year regression forecast for SP Cash was 1119.29 which now seems reasonable to carry over into Q1 given the amount of government intervention manipulating market movements.
And our 2012 GDP forecast was for 0% growth, which is supporting of a bearish bias.
Still, it’s probably a good idea get another data point into Q1, this time by looking at what has happened when the SP futures have closed below their 200 day moving average and bonds have closed above their 200 day moving average at the end of the year.
Sell the SP futures on the close of the last trading day of the year and cover them n days later:
- 20 days later, historically bearish (3/4 75% -49.0 pts sd 73.2 pts z -1.3 llt=46.8 pts f$=3886 k!=0.67)
- 40 days later, historically bearish (4/4 100% -99.2 pts sd 64.8 pts z -3.3 k!=1.68)
- 60 days later, historically bearish (4/4 100% -119.2 pts sd 76.0 pts z -3.1 k!=1.56)
–h
Henry Carstens
503-701-5741