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TrendFlex Credit Risk Premium Signals (CR)
TrendFlex Classic CR and Allegiance signals remains Long.
S&P 500 Return
|S&P 500 timing signals based on credit risk (CR) premiums (corporate vs.Treasury debt).|
|TrendFlex Classic CR||Long||11/08/16||+3.4%||+3.4%|
|TrendFlex Allegiance CR||Long||4/13/16||+9.6%||+9.6%|
The TrendFlex Score declined from 1.64 to 1.48, and settled below its three-week moving average. New highs in the major equity indices helped drive the score lower this week.
TrendFlex Trend-Following Signals (TF)
The TrendFlex Classic TF and Allegiance signals remain in Uptrend. Both have settled on 1.0 scores, as bullish as you can get.
S&P 500 Return
S&P 500 timing signals based on a weighted score of US Market technical indicators. Classic (short-term) and Allegiance (intermediate to long term). Score: Bullish = 1.0-1.75; Neutral = 1.75-2.25; Bearish = 2.25-3.0
|TrendFlex Classic TF||Cash||9/26/16||3.4%||3.4%||1.0|
|TrendFlex Allegiance TF||Uptrend||5/31/16||5.4%||5.4%||1.0|
Baseline Analytics Extremes
Baseline Analytics Extremes highlights four key TrendFlex Indicators and their level of extreme readings. The key indicators include the following:
- CBOE VIX and Put/Call Ratio
- TED Spread
- LQD vs. S&P 500 GAP reading
When one or more of these indicators has reached an extreme reading, chart and commentary will follow.
A large gap in the LQD/SPX ratio vs. its moving average suggests that the recent rally may need a breather. Likewise, the CBOE VIX reading has fallen well below its moving average (see top portion of chart below), although Put/Call is neutral. The VIX extreme is worth watching, however it can meander at this low level for several days.
The Portfolio Strategies chart remains bullish, especially with regards to recent market strength and positive seasonality. Partial hedges to long positions may be in order though as we observe the two Extremes indicators noted above.
|Set Stops on Longs|
|Short Overbought Equities|
|Add to Longs|
|Hedge or Reduce Shorts|
|Long Futures and Options|
*Red highlighted items are recommended strategies