Heck, I know I shouldn't try to time the market but heck if I'm not going to at least try to hedge my bets. I am pretty much 100% long on stocks right now but I do want to be able to reallocate when the time is right. The metrics that I am watching closely are.
1. Yield curve - It's a great market crash signal and a basic sign that majority of people who control money think that the economy will be heading south.
http://www.newyorkfed.org/research/capital_markets/Prob_Rec.pdfThe yield curve inverts when the long term treasury rate is lower than short term treasuries. It pretty much predicted the last 5 crashes, and the last 2 by almost the same month.
2. PE Ratios, CAPE, Shiller, etc.
Call it what you will, but when PE ratios are high, that means something is up. You can rationalize the exact reason why but it is what it is. People are willing to pay a lot of money for very low yields. That means something is up. There are no better alternatives, corporate earnings are down, people expect corporate earnings to be up next year, etc. But as a general broad metric, the PE ratio is a good one to add to the list to keep an eye on.
3. General economic indicators:
Employment rate, inflation, etc. Skirt lengths, consumer confidence surveys, skin color of Presidents, twitter feeds what have you. Whichever ones floats your boat.
4. Trendlines.
The MACD trend line correctly predicted the 2000 and 2008 crashes, and the 52 week SMA also did a pretty good job. If trading costs are low (if only in Vanguard funds, for example) then it doesn't hurt to get in and out when the trendlines do break from positive to negative sides. It would have saved you a lot of money in the 2 most recent big crashes of 2000 and 2008. There would have been many false positive readings as well, but if trading costs are negligible or zero, and you don't mind paying attention to the headlines, then it's worth it I think.
I was thinking about selling out of the majority of my positions today on positive news, but I think Monday will have a good start and I will sell off then. Or if Monday has a shitty start, then I will also sell off then. As an aside, I realized how hard it would be for me to sell off my positions quickly because of the sheer number of different things that I am invested in. A bunch of different mutual funds and a bunch of different IRA accounts (roth, roll over, simple, taxable acct). I was doing a rebalancing portfolio bit but I think I am going to do only 2 etfs. BND and VTI. It makes it much easier to sell off my positions when I hit the panic button.
See you on the other side of the bear market! ;)