Roubini Stock Market Signal Is Right Again

By Meena Krishnamsetty

NEW YORK (TheStreet) -- The Roubini Sentiment Indicator, named after famous bearish economist Nouriel Roubini, was right again about the stock market.

The indicator turned bullish three weeks ago, giving a "buy" signal on Oct. 10. The following day, the SPDR S&P 500 ETF(SPY) closed at 116.65.

The Roubini Sentiment Indicator has historically been 62% reliable when giving buy signals, with gains averaging 1.5% over the following three-week period. The SPY closed at $118.49 this past Friday and returned 1.58% over the previous three weeks.

We're not saying Nouriel Roubini turned bullish on the stock market. He's as bearish as he was six or 12 months ago. What we are saying is that there's a huge decline in the number of people searching for Roubini's predictions on Google. And this is bullish for the stock market. What isn't good for Roubini is good for America, and what's good for Roubini isn't good for America!

There's more. Two weeks ago, on Oct. 17, the Roubini Sentiment Indicator again provided a buy signal. On Oct. 18 the SPY closed at $118.28. If history is any guidance, then there's a 62% chance the SPY closes this week higher than $118.28.

This article was originally published at Insider Monkey.

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