Imminent U.S. Disaster: Outlook 10 December '13

after market update: actual S&P -5.75 (-0.3%); Markets were slightly down in choppy trading today.  Is today's slight dip a pause before the next big rally or the beginning of a sharp sell-off?  Watch for tomorrow's outlook to be posted around 12am ET.

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Overview: The final pre-requisite for the Next American Tragedy, according to research on collective mood patterns immediately preceding major U.S. tragic events since July 2012, has occurred.  The line in the bottom chart referred to in that post has just peaked, meaning the next major event is within a week of occurring, most likely much sooner.  The social mood pattern for today reflects desperate aggression.  Themes in the news reflect destruction, deterioration, or disaster, with a possible connection with government or government intervention.  Markets may be mixed and confused, or make a start in one direction with an abrupt shift to the other.

Today's Market Outlook is mixed (-0.4% to +0.6%).  The social mood signal is down, and the signal from themes in the news is up.  Watch for either a confused, mixed market or a possible abrupt shift. The projected stock market change for today is shown in the chart below.

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Near term mood outlook: desperate aggression.  Themes in the news reflect destruction, deterioration, or disaster, with a possible connection with government or government intervention..  The combined pattern of news and social mood reflects a high global risk of violence, protests, and a high risk of geopolitical escalation.  

 

Near term market outlook: The social mood signal is indicating a serious downturn in social mood that is likely to be followed by the markets. 

 

Longer term outlook: The overall social mood trend has been in what appears to be a topping process for many months.  This topping process appears to be in its final stages.  A sharp market drop of more than 15% indicated by long term mood and market charts, appears very close to beginning.

 

Today’s social mood signal is -7.7 S&P points as of the time of this posting.  On a daily basis, markets tend to follow social mood more often than not.  Overall, social mood trend changes often precede market trend changes.

 

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Today’s news signal is +11.6 S&P points as of the time of this posting.  News tends to follow the general trend of the market, but on a daily basis, can either lead or lag the movement of the market.    

 

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Note: data for U.S. social mood are scores in eight MoodCompass categories of Google Hot Trends, data for news are scores of top Google U.S. news stories.  Scores are converted to 4 inputs to the Market Mood Model.  The output is a conversion of mood data to estimated S&P point change.  Stock market data source: Google Finance.  This is posted as a public service, and to enhance exposure to our research.  It is not intended to be trading advice.