Todd Market Forecast 9/28/7

Todd Market Forecast Stock Market Update for Thursday 09/27/07
www.toddmarketforecast.com
Available Mon- Friday after 6:00 p.m. Eastern, 3:00 Pacific.

DOW + 35 on 1000 net advances
NASDAQ COMP. + 11 on 450 net advances

SHORT TERM TREND Bullish
INTERMEDIATE TERM TREND Bullish


Market Commentary

Let’s discuss the longer term. We are rapidly approaching favorable seasonality for the stock market. Let’s be more specific. According to research by the Stock Trader’s Almanac, the period from November 1st through April 30th far outstrips the other six months. From 1950 through 2005, this period has gained at total of 11,692 Dow points. The other six months actually lost 539 points.

Why does this happen? Perhaps it’s because it contains the best three months of November, December and January. Why these three months? Perhaps the good feeling about the Thanksgiving, Hanukkah, and Christmas holidays, Or the yearly reinvestments from funds in January. Or because the so called bad six months are roughly coincident with the hurricane season.

We are bringing this up now because the “best six months” frequently gets a head start in October. This month often experiences a scary decline and from there it is up and away.

Not every “good six months” is up. Since 1950, eleven of them have been down, but this is still an 80% batting average. When you throw in the fact that we are just coming off a massive oversold condition, the odds would seem to be pretty good.

NEWS AND FUNDAMENTALS:

New home sales dropped 8.3%. The expectation was for a drop of 5.2%. Home sales are now at a 7 year low. Initial claims were 298,000, less than the consensus 316,000. GDP was revised to 3.8%, less than the anticipated 3.9%.


BOTTOM LINE:

Our intermediate term systems are on a buy signal. Mutual fund investors are in 100% invested position. ETF investors are long the S&P 500 ETF, symbol SPY from 153.32.

Short term ETF traders are in cash. I’m not going to chase it here. After Monday we should get a pullback.


OTHER MARKETS

We are moving back to a buy on bonds as of today September 27.
We are on a sell for the dollar and a buy for the Euro as of September 11.
We are on a buy for gold as of September 18.
We are moving back to a buy for crude oil as of today September 27.
We are long term bullish for all major world markets, including those of the U.S., Britain, Canada, Germany, France and Japan.


STEPHEN TODD: A SHORT BIOGRAPHY

Editor and publisher of the Todd Market Forecast, a monthly stock market newsletter with an included nightly hotline.

Steve has published articles on the stock market in the following publications: Barron’s, Stock Market Magazine, Futures Magazine, The National Educator, and others.

His stock market commentary is heard on the following stations: CNBC, Bloomberg, CNNfn, Associated Press Radio, Business Radio Network, CKNW in Vancouver, British Columbia, KFWB, Los Angeles and ROBTV in Toronto, Ontario.

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