Frequently Asked Questions

Dr K Market Direction Model
When the Timing Model signals a buy or a sell, do you automatically buy or sell stocks?

The signals issued by the timing model are mainly for profiting via ETFs. The signals also help confirm the action of the leading stocks. In essence, when it comes to stock selection, we let the stocks tell us what to do. When it comes to ETF selection, we let the timing model tell us what to do.


Thus, on a buy signal by the timing model, we may already have bought one or two leading stocks prior to the signal if they signaled buys by showing strength by bucking a neutral or downtrending market, though since most stocks tend to trend with the market, buying a stock or two in a downtrending market would be unusual.  Note, a buy signal will not prevent us from issuing Short-Sale Set-Up (SSS) reports on stocks we believe are showing weakness, though with the caveat that should the market uptrend continue, shorting is not advised since any short positions should be done in synchrony with a market correction.


On a neutral or sell signal issued by the model, we will let any stocks we own tell us when to sell. We are hoping that some will buck a downtrend so we can hold them through the rough period. Such stocks often lead the way higher once the market finds its bottom and starts to head higher. In unusual cases as noted above, we may buy a stock if it is behaving right even if the model is on a neutral or a sell signal.

Published: Sep 30 2010