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With the Catastrophic Stop Loss Model still favorably positioned (when it reverses and recommends increasing cash, we will follow) and favorable seasonals into year-end, the S&P 500’s price trend remains intact. However, many internal measuring tools are vulnerable.

The Catastrophic Stop model increased to 72.9% from 67.9% last week due to the sentiment composite shifting from bearish to neutral. The Internal Composite is bullish, and the External Composite is neutral.

During Q324, with the S&P 500 near 5700, we highlighted 5900 and 6100 price targets. SPX printed 6099.97 last week. The Catastrophic Stop model remains bullish, but resistance, negative A/D Line divergences again, and a lot of bullishness suggest volatility in the next few weeks.

The Catastrophic Stop model improved to 67.9% from 60.7% last week. The Internal Composite is bullish, and the External Composite is neutral.

In November, domestic equity market indices—including capitalization, equal-weight, small, mid-, large cap, value, and growth—closed higher. With complacency (excessive optimism) building and a potentially sloppy start to 2025, price momentum is supportive until the month’s end.

We continue to invest in companies producing excess returns through positive economic profitability, supported by solid balance sheets, significant cash generation, & trading with considerable margins of safety. We believe these factors will continue to provide rational opportunities for the foreseeable future.

The Catastrophic Stop model is unchanged from last week’s level of 60.7%. The Internal Composite is bullish, and the External Composite is neutral.

The Catastrophic Stop model combines time-tested, objective indicators designed to identify high-risk periods for the equity market. The model held steady in November and entered December with a fully invested equity allocation recommendation. If our models shift to bearish levels (below 40% for two consecutive days), we will raise cash.

The Catastrophic Stop model combines time-tested, objective indicators designed to identify high-risk periods for the equity and equity-related fixed-income markets. The model held steady in November and entered December with a fully invested allocation recommendation. We will reduce duration and risk if our models shift to bearish levels (below 40% for two consecutive days).

The Catastrophic Stop model combines time-tested, objective indicators designed to identify high-risk periods for the equity market. The model (Figure 1) held steady in November and entered December with a fully invested equity allocation recommendation. If our models shift to bearish levels (below 40% for two consecutive days), we will raise cash.

Near-term resistance exists within a bullish price channel and as negative A/D Line divergences are resolved. The Bulls remain in control, but we’re watching for signs that post-election market action is part of a transition to a choppier 2025.

The Catastrophic Stop model increased to 60.7% from 55.7% last week. The Internal Composite is bullish, and the External Composite is neutral.

Negative A/D Line divergences, an overbought condition, and resistance can be remedied at any point. But until they are, it is prudent to manage risk and have exposure to an investment strategy that objectively manages risk, i.e., our Smart Sector strategies.

The Catastrophic Stop model declined to 55.7% from 67.9% last week. The Internal Composite is bullish, and the External Composite is low-neutral.

The Catastrophic Stop model increased to 67.9% from 60.7% last week. The Internal Composite is bullish, and the External Composite is neutral. The model continues to recommend a fully invested position.

Following the 2016 and 2020 Presidential elections, equities ripped higher into year-end and beyond. Including 2024, I’d call it a three-peat, at least into year-end. The odds favor the S&P 500 follows a year-end rally scenario with volatility in both directions. 

Alongside the U.S. Presidential and Congressional election outcome, how equities react to today's Fed announcement may be significant in the short term. Considering yesterday’s moonshot, please incorporate a strategy emphasizing risk management.

The Catastrophic Stop model declined to 60.7% from 67.9% last week. The Internal Composite is bullish, and the External Composite is neutral. The Catastrophic Stop model has moved closer to neutral, setting it up to generate a sell signal more quickly if conditions warrant.

The Catastrophic Stop model combines time-tested, objective indicators designed to identify high-risk periods for the equity market. The model declined toward the end of October but entered November with a fully invested equity allocation recommendation. If our models shift to bearish levels (below 40% for two consecutive days), we will raise cash.