THERE’S A U.S. STOCK MARKET SIGNAL FOR A POSSIBLE ‘PARABOLIC’ MOVE IN PRICES $AAOI $JKS $AMZN $FB $MSFT $EPI $INDA $RSX $AMD $X $NVDA

The stock market has been going straight up. And a new signal has just been given, showing that it’s possible that you haven’t seen anything yet. Let’s start with a chart to understand this.

Chart

Please click here for the chart, which compares the S&P 500 ETF SPY, with momentum ETF MTUM.  Notice the rate at which the S&P 500 has risen. Also notice that, until recently, the momentum ETF had lagged behind but has now caught up.

Parabolic move

In mathematical terms, a parabola is a curve where any point is at an equal distance from a fixed point called the focus and a fixed straight line called the directrix. In the context of the stock market, a parabolic move simply means that the rate of the stock market gains will increase by a large amount.

A parabolic move can be highly profitable. There is potential to make more money in the stock market than has already been made.

The signal from the algorithms

For market timing and allocation, at The Arora Report we use the adaptive ZYX Global Multi Asset Allocation Model. Adaptive means that the underlying algorithms automatically change with market conditions. The model has macro, fundamental, quantitative and technical inputs in 10 categories.

The probability of a parabolic move, according to the algorithm, has been limping along around 0% for a very long time. The probability of a parabolic move has just jumped to 20%. It is due to a combination of different factors. The biggest factor is the way stocks are acting after they report earnings that are better than the whisper numbers and analysts’ consensus numbers…Read more at MarketWatch

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