S&P500 Short Term Market Breadth Analog Forecast Starting May 25, 2015

By Lawrence

Review of Forecast for May 18, 2015

The expectation of limited upside was correct. In fact, all week consolidation. The potential of starting a strong decline was not confirmed yet. The breadth analog model did a fair job last week.

Forecast Starting May 25, 2015

Summary of the S&P500 short-term forecast based on my proprietary market breadth analog model as of the close of May 22, 2015:

Start of a modest decline is expected
Selling will accelerate if 1.5% down side is registered

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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