MDM - Model switches to SELL on June 7, 2012

Published : June 7 2012 at 10:53 ET

The recent weak bounce along with foot-dragging on the part of central banks lend further fuel to the current downtrend. MDM has thus switched to a SELL.

Based on Bernanke's testimony, it seems the markets will have to fall further before Bernanke cries Uncle! It therefore seems as if the downtrend should continue on this basis since the European Central Bank and U.S. Federal Reserve are not accelerating the pace of quantitative easing until the market falls further. Price/volume of major averages and leading stocks continues to be relatively morose.


Suggested inverse ETFs:

1-times inverse

RWM - Russell 2000 small cap 1x bear. It should approximate 1x the inverse of the Russell 2000.

2-times inverse

TWM - Russell 2000 small cap 2x bear.

3-times inverse

TZA - Russell 2000 small cap 3x bear.

EDZ - MSCI European emerging markets index 3x bear. Note, there are 1x and 2x equivalents but they are too thin so we would suggest position sizing in EDZ according to your risk tolerance levels.

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