The Trend Asset Allocation Model is an asset allocation model that applies trend-following principles based on the inputs of global stock and commodity prices. 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 be found here.
![](https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEguR15ZEOawIRYdKyeaVYS0XSfVy2zeBNLLI7AHkBy886ofC_SMifS80-oYuKfUSQnO3DwqF6rJfH162Bi8UahgAtkphQB7oc6NDKZ1_dTRRgFdbOlsmqp22zhJKyN6FrwNmB1lAVV8dvkLy12x_sk3dYG3TZK8znUp5C99wNiaqM48nz2JKUgNcN8upUPN/w400-h291/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/AVvXsEiblTwjHqNTm6AmOGBWssb7lIv-3Sjjcag8DZhSl-wM5y_UfqPgCwaJgMY2eIYZcfSWkBBSiQwmWFfaWZ6P0EOfhvGnZ3pvTXi3PFr-7h5CvrE9DwmiMxWivOhV9rfhnRQaf18HpyTHU2utXbqdaVqBoEjJOzmVZZbYWDZGS2KRtJO-eXEz2HA6XDqvWGTR/w400-h291/Inner%20Trader.png)
The latest signals of each model are as follows:
- Ultimate market timing model: Buy equities (Last changed from “sell” on 28-Jul-2023)*
- Trend Model signal: Bullish (Last changed from “neutral” on 28-Jul-2023)*
- Trading model: Bullish (Last changed from “neutral” on 14-Apr-2024)*
Update schedule: I generally update model readings on my site on weekends. I am also on X/Twitter 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 good overbought advanceThe S&P 500 violated a rising trend line in early April and corrected. It appears to have formed a V-shaped bottom and it is resuming its advance by clearing a resistance and volume congestion zone. It’s also exhibiting a series of “good overbought” conditions on the 5-day RSI. The “good overbought” rally will be confirmed if and when the 14-day RSI becomes overbought and stays overbought.
![](https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEitq2lgbv3-4p6W_eliZBYKAIExWnzvarPDRDaSI2s_8uxxuddc54hHX7wLdgEfNVOMde3gSk-J8ufxfM5qKriQ_DkgXB-tQ7C5PRch2QP0BRMa4rEfbui4irTIA6CaD5r14PRsPxrteFGEFWBDRsMjCzNyykVfUxeCH7v5To6WH9JAcnNil10_BJPOSbte/w400-h303/SPY.png)
Market internals are pointing to another sustained upleg in stock prices. Here are four other reasons why.