While major indices attempt to push higher into new multi-year highs, there is an increasing concern that a correction is coming. Given that the global economy has no shortage of headwinds brewing, it seems that Wall Street is holding its breath for bad news to eventually spark a move lower.

In this week’s interview with Toni Turner of TrendStar Trading Group, we discuss how traders and investors may want to approach this kind of market.

EQ: Can you talk about the inverse relationship between the UUP and the DIA. Why have you been watching this relationship, and what is it telling you?

Turner: I monitor a weekly chart of the SPDR Dow Jones Industrial Average (DIA) and the PowerShares DB US Dollar Index Bullish (UUP), and sometimes even a monthly chart, because it tells me a lot in one glance . Of course, the UUP is an ETF that tracks the U.S. dollar versus a basket of six major currencies. Many times, the UUP and the DIA will move in generally the opposite directions. If you watch a line chart of the two of them, it suggests that when the UUP strengthens, the DIA will weaken. This is partly because a rising dollar makes U.S. goods more expensive overseas. The currency factor also has an impact on the earnings of multinational companies, which the Dow stocks are. So when the U.S. dollar in the form of the UUP rises in value, it can cause the Dow to weaken. You’ll see the UUP move up, and then usually, the Dow will move lower.

Right now, the UUP is low, and of course, we’re seeing multi-year highs on the Dow. When these two rubber bands are stretched too tight—meaning one too high and one too low—then the chart tells me that at some point, they will reverse and head toward each other. Of course, I can’t necessarily tell you when that will happen, but it will happen. For those who want to know more about this, I will be discussing it further on my Market Now video newsletter this weekend and will review that chart as well.

EQ: Are there any other signs that you’re noticing that are telling you the market may be ready to start heading lower in the near term?

Turner: If you look at the 14-day relative strength index (RSI) on any of the charts of the major indices, you will see that it has weakened slightly. I think the market at some point is just going to get tired, but at the moment we’re in an uptrend, and a very nice one, at that. So until something negative comes out of Europe or Washington—and those are my guesses as to where the negative news may come from—investors seem very content right now to sit tight. However, institutional investors and many individual investors are so fully invested in the market right now, all we need here is one feather-weight bit of negative news and we’ll get a pullback.

EQ: How do you play a market like this where you don’t want to miss the upward movement but there’s also the potential for a downturn is there?

Turner: I have been making sure that my stops are in place. I’ve also taken some profits and have some cash ready as I’m waiting. Patience is not my strongest point, but the longer I trade and invest, the more I find patience to be a very helpful trait.

EQ: You’re also watching oil and the United States Oil (USO). Is there any particular setup you’re watching for here?

Turner: We’re getting a lot of news lately that manufacturing is coming back into the U.S. and that is very good for the long term for oil. I’ve been watching the oil futures, and the March E-mini light crude WTI has been pulled back quietly from its Jan. 30 highs at $98.25, and it’s now at $97.58. The USO pulled back from its Jan. 30 highs of $35.53 and it’s moved sideways since. We have had a fairly bullish pattern as of Monday, and it looks like it’s holding this level now. If the USO moves up back toward its January high, I would be interested in maybe purchasing a small amount and making sure my stop is below $34.40. I’d leave it there for a few days to see if the USO can break out above the $35.50 high.

EQ: Telecom was one group that we discussed last week. How has that done? Are there any additional sectors or groups that interest you this week?

Turner: Telecom is mostly sitting there. It’s holding a consolidation and it seems content to sleep through the last week. There are some telecom stocks doing better than others, but in the aggregate, the telecom index is just moving sideways. Of course, if you’re watching oil move higher, and you think it will move higher, I’ve been watching the Guggenheim Solar ETF (TAN). Many times, when oil prices move higher, solar stocks do well. The TAN, like most stock-based ETFs, has attracted increased volume in the last couple of months—but in TAN’s case—quite a bit more. It’s been holding in the $18 zone here. We can keep an eye on TAN here as long as it stays above $17.50.

Another similar play on this is the PowerShares WilderHill Clean Energy (PBW), which is a low priced ETF. That’s moving in an uptrend right now, and as long as oil prices move higher, it’s conceivable that this ETF could as well.