As recently as the first day of February, the euro sat at 52-week highs and EUO rested at 52-week lows. Today, EUO is on the verge of rising above a near-term trendline. The further EUO climbs, one might expect riskier stock assets to fall.

2. iShares DJ Home Construction ( ITB). I experienced a bit of criticism for suggesting that it is a bad idea to buy any fund when its price is 22% above a 200-day moving average.

Well, ITB has lost about 7% in value, so it's not quite as overbought as it was when I last discussed the matter.

More critically, U.S. homebuilder confidence fell in February, while actual housing starts dropped 8.5% in January. Equally disconcerting, the upcoming sequestration cuts may have an adverse effect on real estate, from Superstorm Sandy reconstruction endeavors to the processing of FHA-backed home loans.

Low mortgage rates and the real estate recovery story have fueled the stock market. If ITB continues to deteriorate below its 50-day trendline and struggle there, a corrective phase for stock assets could take up residence.

3. PowerShares S&P 500 Low Volatility ( SPLV). One of the easiest mechanisms for tracking changes in relative strength is a price ratio. For example, when low volatility funds like SPLV are underperforming the S&P 500 market at large, the SPLV:SPY price ratio would decline. In 2012, market peaks occurred near April and early September, when the SPLV:SPY price ratio hit low points.

In contrast, when SPLV:SPY is rising, and when it climbs above key trendlines like the 50-day, risk aversion may be back in vogue. The higher this ratio climbs, the better non-cyclical sectors perform (e.g., staples, utilities, health care).

This article was written by an independent contributor, separate from TheStreet's regular news coverage.

Disclosure Statement: ETF Expert is a website that makes the world of ETFs easier to understand. Gary Gordon, Pacific Park Financial and/or its clients may hold positions in ETFs, mutual funds and investment assets mentioned. The commentary does not constitute individualized investment advice. The opinions offered are not personalized recommendations to buy, sell or hold securities. At times, issuers of exchange-traded products compensate Pacific Park Financial or its subsidiaries for advertising at the ETF Expert website. ETF Expert content is created independently of any advertising relationships. You may review additional ETF Expert at the site.

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