August 20,2012     In my article “The Ultimate Death Cross – False Harbinger of Doom” I showed that the spread between the 50-month moving average (MA) and the 200-month MA of the S&P will form a trough before the end of this year, irrespective of the level of the S&P over the next few months. This event provides a positive outlook for the stock market and could herald a new bull market to 2025.

Most of us are not familiar with Terrence Laundry’s T-Theory, which is a method of analyzing general investment trends using a time symmetry property. It basically states that the duration over which investors can obtain “superior equity returns” will always be equal to the previous time period in which returns were subnormal. The practical purpose of the theory is to anticipate the runs of “superior returns”.