S&P500 Short Term Market Breadth Analog Forecast Starting Mar 23, 2015

Review of Mar 16, 2015

Bullish bias realized for the week. Even though FOMC decision has driven S&P going straight up, S&P500 could barely enter the +2.5% boundary. A good forecast overall.

Forecast Starting Mar 23, 2015

Summary of the S&P500 short-term forecast based on my proprietary market breadth analog model as of the close of March 20, 2015:

1. Neutral all across implies limited up side (+1.5%) and down side (-2%) in coming 5 trading days
2. The trend down pattern suggest S&P500 will likely start to retrace its excessive up move the week after
3. Higher than usual chance of pushing below –2.5% by 3rd week from now

Report Snapshot

Short Explanation About The Model

My market breadth based analog model takes into account the short term volatility, daily market breadth readings and a few other intraday breadth data to identify the current market conditions. Using the information, the model then went through the historical data over the past 20 years to generate its statistical analysis. The model has been pretty good at identifying important swing tops and bottoms over the past few years by providing early warnings about potential volatility upticks.

For the technical explanation of the concept, you can read about it here, Market Breadth Primer: Market Breadth Analog Forecasting Method

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