) -- Since March 9, the

S&P 500

has jumped 52% and has left the equity benchmark index valued at nearly 19 times the profits of its companies. Historically, the month of September is no friend to the equity markets and many believe that history will not be broken.

On the positive side, there have been a few economic indicators suggesting that the economy is recovering, which traditionally gives a boost to the markets. The Institute of Supply Chain Management reported that its index for measuring manufacturing activity rose to a 52.9 in August, indicating that expansion took place last month.

In addition, the real estate sector is showing signs that it may have hit a bottom. The National Association of Realtors stated that its seasonally adjusted index of sales contracts for previously occupied homes signed in July rose 3.2% to its highest level in the past two years. To add icing to the cake, construction of new homes and apartments rose 2.3% in July.

Although this is encouraging news, there are more signs suggesting that the markets will cool-off. In the real estate sector, many suggest that the recent boom has been fueled by the government's $8,000 first home-buyer tax credit and historically low mortgage rates and can't be sustained when the tax credits expire and interest rates start creeping up.

Many also believe that there will be a point of saturation where buyers who qualify for mortgages will eventually run out. After all, one needs a stable job history and the ability to prove sources of income to obtain a mortgage loan; until unemployment levels stabilize and start improving this will remain a challenge for the sector.

To add to the worries, the Department of Commerce reported that commercial construction spending sank 1% in July and it is the growth of businesses that will fuel a sustainable recovery.

Next, investors seem to be wary of the health of the financial sector as many are fearful that banks will continue to post losses and shares of insurers have risen too far. There have also been rumors that the federal government will reduce its support of bailed out insurers like

American International Group

(AIG) - Get Report


Lastly, some believe that the U.S. equity market was piggy-backing on the Chinese markets as the Chinese buying spree lifted all global markets. With the Shanghai Index down nearly 25% from its recent peak, it is believed that the U.S. markets are going to follow.

The fundamentals are just not favorable -- the U.S. markets are at their most expensive levels since June 2004. Below are the uptrends seen in the broad-based U.S. equity markets:



(SPY) - Get Report

is up 50% from its $68.11 close on March 9 to close at $102.46 on Monday.


DIAMONDS Trust Series 1

(DIA) - Get Report

closed at $95.05 on Monday, up 45% from its March 9 close of $65.44 .


PowerShares QQQ


closed at $40.03 on Monday after a March 9 close of $25.74, an increase of 56%.

When investing in equities, it is important to keep in mind the inherent risks involved and a good way to minimize these risks is through the use of an exit strategy. According to the latest data at

, an uptrend in the previously mentioned ETFs could potentially come to an end at the following price levels: SPY at $98.73; DIA at $91.88; and QQQQ at $38.68. Keep in mind that these price levels change daily and updated data can be found at


-- written By Kevin Grewal in Laguna Niguel, Calif.

Kevin Grewal is an editorial director and analyst at where he focuses on mitigating risks and implementing exit strategies to preserve equity. Prior to this, he was an analyst at a small hedge fund where he constructed portfolios dealing with stock lending, exchange-traded funds and alternative investments. He is an expert at dealing with ETFs and holds a bachelor's degree from the University of California along with a MBA from the California State University, Fullerton.