The model is suggesting that there is no trade at that moment. The model results still suggest high yield investments such as high yield corporate bonds and REITs, however, there is no clear trade at the moment such as emerging markets, developed markets, gold, or energy.
We received a sell signal last month regarding energy and other commodities as that turned out to be correct. However, our long measures are still bullish on energy and energy-related markets. It could still be a long-term play.
Markets that still look good are Indonesia, India, and the UK.
However, when there is no real trade the model is suggesting it usually means the market will stay flat or head down. We suggest holding a decent amount of cash at the moment.
Monday, May 30, 2011
Sunday, May 22, 2011
Market Update 5.21.11
Model results suggest there are not many market plays out there at this time, which is a sign the market does not look great.
The model likes the developed markets of the UK, Europe, and US. However, the US short indicator is moving up signaling to reduce allocation there.
The model likes certain emerging markets such as Indonesia, India, and Thailand. Chile and China are on the radar.
High yield investments.
If we continue on the 2004 path the US market will see some slight upside going into June and then a down July. This is why we are holding a good deal of cash waiting for August.
However, even though July will be down we do not forecast a lot of volatility. No flash crash, no major market correction, no Fed surprises. The best play is to best against volatility.
The model likes the developed markets of the UK, Europe, and US. However, the US short indicator is moving up signaling to reduce allocation there.
The model likes certain emerging markets such as Indonesia, India, and Thailand. Chile and China are on the radar.
High yield investments.
If we continue on the 2004 path the US market will see some slight upside going into June and then a down July. This is why we are holding a good deal of cash waiting for August.
However, even though July will be down we do not forecast a lot of volatility. No flash crash, no major market correction, no Fed surprises. The best play is to best against volatility.
Monday, May 16, 2011
Market Update 5.15.11
Last week mentioned the US stock market would be flat or down. The US stock market was slightly down. Based on the dynamics we see in the market and in our model we see a very tame US market until July. The US market might go slightly down then slightly up.
Currently the model likes select emerging markets such as Indonesia, Poland, India, and Thailand. It may take a several months for these market to see decent returns. But the early signal for these markets has come.
The model also likes high yield corporate still, REITs, and emerging market debt.
We are currently short energy producing markets for now.
Currently the model likes select emerging markets such as Indonesia, Poland, India, and Thailand. It may take a several months for these market to see decent returns. But the early signal for these markets has come.
The model also likes high yield corporate still, REITs, and emerging market debt.
We are currently short energy producing markets for now.
Sunday, May 8, 2011
Market Update 5.08.11
In our lat blog we suggested the following:
"Last week we suggested the past week would be a down week for the US market. Monday was down 1% but the market rebounded later on in the week. So far we have noticed a that 2011 is similar to 2004. If this similarity is to continue than the next 3-4 weeks will be down weeks.
The model is also signaling to shift out of commodity such as energy and precious metals and go back into select emerging markets such as India, Turkey, Thailand, and Indonesia."
Since that post energy and commodities have down considerably, with some ETFs going down almost 20%. In addition, the US market went up that following week but decreased this past week. Based on our analysis the US market will decline this week or next before rebounding.
The US market has made a sizable shift in our measures and we have sold out of the US market. We have sold out of energy and commodities and have shorted energy related markets such as Russia and Canada.
We continue to like US high yield corporate, emerging market debt, and REITs in addition to select emerging markets such as Poland, Indonesia, Brazil, and Turkey.
The model is now signaling to get back into China and Taiwan. However, we are waiting a week or two since the model is signaling a weak market to continue than a large rebound which will then lead to a down market for June and July.
"Last week we suggested the past week would be a down week for the US market. Monday was down 1% but the market rebounded later on in the week. So far we have noticed a that 2011 is similar to 2004. If this similarity is to continue than the next 3-4 weeks will be down weeks.
The model is also signaling to shift out of commodity such as energy and precious metals and go back into select emerging markets such as India, Turkey, Thailand, and Indonesia."
Since that post energy and commodities have down considerably, with some ETFs going down almost 20%. In addition, the US market went up that following week but decreased this past week. Based on our analysis the US market will decline this week or next before rebounding.
The US market has made a sizable shift in our measures and we have sold out of the US market. We have sold out of energy and commodities and have shorted energy related markets such as Russia and Canada.
We continue to like US high yield corporate, emerging market debt, and REITs in addition to select emerging markets such as Poland, Indonesia, Brazil, and Turkey.
The model is now signaling to get back into China and Taiwan. However, we are waiting a week or two since the model is signaling a weak market to continue than a large rebound which will then lead to a down market for June and July.
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