As you can see, this isn’t particularly bearish for the S&P 500. However, this is more bearish for the Russell 2000 (small caps) than it is for the S&P, which suggests that small caps will underperform over the next year.

Moreover, you can see that the stock market’s forward returns are starting to become mixed. Our studies from January – July were very bullish. Now, some of our studies are no longer as bullish. This suggests that we are approaching a major stock market top in 2019.

My upcoming Long Term Risk Model demonstrates that we’re almost at the point at which “things can’t get much better”, but we’re not completely there yet.

Click here for more market studies.

By Troy Bombardia

BullMarkets.co

I’m Troy Bombardia, the author behind BullMarkets.co. I used to run a hedge fund, but closed it due to a major health scare. I am now enjoying life and simply investing/trading my own account. I focus on long term performance and ignore short term performance.

Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors.

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