The Trend Asset Allocation Model is an asset allocation model that applies trend following principles based on the inputs of global stock and commodity price. This model has a shorter time horizon and tends to turn over about 4-6 times a year. The performance and full details of a model portfolio based on the out-of-sample signals of the Trend Model can bsoe found here.
![](https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjcaL7Ya_5QfCI3N0ADOLVawVcpIR9o5omd0T7IEjq64KEq5reA1mYalDuSi8nuoGqyuQ5ILjdCNUD2c0xPCye0KMrHOWpZK6nYgHy-VGslAp5136IVgwhu7nSOUHGg1yIrmE1VCzPehg9vzBT2-W4asYRQzy5iHeuSrY_aEjP9NSkj5O7f7YJPjV_qSQ/w400-h290/Trend%20Model%20perf.png)
My inner trader uses a trading model, which is a blend of price momentum (is the Trend Model becoming more bullish, or bearish?) and overbought/oversold extremes (don't buy if the trend is overbought, and vice versa). Subscribers receive real-time alerts of model changes, and a hypothetical trading record of the email alerts is updated weekly here. The hypothetical trading record of the trading model of the real-time alerts that began in March 2016 is shown below.
![](https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgQAVyb2-xiQaIfjhCFLdePw-bNxG_WgYHZUjOo4lLmatO4i9ce-kdLjQuhEpu5d2mWA8fg-sNTATVa_Id_yOWWasoGS6fJRXCwX4Q3PIZXIl4LmJr78Web_ckzNUswNKJ-fLru2Vit9IzND7pSpvWRKU9ANItdIJCuDO0n6Z4NUKN1XerCb4zIXBGgow/w400-h291/Inner%20Trader.png)
The latest signals of each model are as follows:
- Ultimate market timing model: Buy equities*
- Trend Model signal: Bearish*
- Trading model: Bearish*
Update schedule: I generally update model readings on my site on weekends and tweet mid-week observations at @humblestudent. Subscribers receive real-time alerts of trading model changes, and a hypothetical trading record of those email alerts is shown here.
Subscribers can access the latest signal in real-time here.
A bifurcated marketAs the S&P 500 struggles to hold its 50 dma, an unusual condition is occurring in the US equity market. The intermediate-term technical outlook is decidedly bearish, but the survey sentiment has reached a crowded short condition, which is contrarian bullish. This week, I offer some canaries in the coalmine as a way to resolve the wildly differing views of the market.
![](https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhqv_bA0KvpK_SZGgdYDBvz0UtwN1NUmZTTU11ncUgPIhwQFRlmH6YPkBHY3_Mr1UniX8eYPC-Q1NTrdmsFhqxUhP3SfDGg53qU7gLoLt40LgVuV8PBD5IwVSoz7zu8T_sxfg9ogz6tKD9SApUVh6ZTERJDg_vCtPUBocDroF-3MDtuIGAFpaAx1n0BtQ/w400-h303/SPX.png)
The full post can be found here.