QE3 = Market Overheated Alert (Key Reversal Indicator)

Yes, there is no risk in the world anymore as the powers that be have put a cushion underneath any fall. However, there is something called technicals and valuation that are also important to consider.

Below is a view of the new product line up for the TriggerPoint Research – Model Portfolio, The important aspect is the Key Reversal Indicator (KRI) is showing an extremely overheated condition.

In these situations there has historically been a sell-off from the highs that will occur within days that will bring markets back to to equilibrium.

In response to this, we look to hedge out portfolios with broad based inverse ETFs or options.

When looking at the report, take a close look at the Key Reversal Indicator gauge and chart.

[gview file=”http://www.thedisciplinedinvestor.com/blog/wp-content/uploads/2012/09/TPR-Trend-Indicator-20120914.pdf”]

 

 

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