Despite the pervasive, seemingly chronic sense of doom besetting the current economic landscape, there will ultimately be a recovery. The key question for many is when will the current downturn bottom out and a recovery begin.

For people who wish to position themselves for the inevitable recovery, there are a handful of key indicators that will provide hints, albeit slowly at first, regarding when the recovery will finally take hold.

Among these leading indicators of the broad economy are housing starts, manufacturing activity, consumer confidence and the stock market. For most of these gauges, close watchers of the economy first will begin to detect future economic growth not when a month's worth of data is all pointing upward, but when some of the indicators are less bad than they have been. For the mathematically inclined, this is the second derivative of an indicator's trend, or its "change in the change."

A timely example of this is March's Census Bureau report on housing starts, released on April 16. At 510,000 units, this level of housing starts represents a decline of 48.4 percent versus a year ago. While at first not appearing to be encouraging, within the report it is found that single-unit starts (a strong majority of activity within the housing starts data), at a level of 358,000 units, have been above the January low for two months. Of course, with any of these indicators, two months does not signal a trend, but watch for the change over the next few months.

The Institute for Supply Management releases its monthly index of manufacturing activity on the first business day of the month. A reading of 50 or higher indicates expansion within the manufacturing sector, while a reading below 50 indicates contraction. The March release showed an index reading of 36.3, representing a deep contraction. However, while the manufacturing sector is still contracting, there have now been three straight months in which this reading has rebounded off its December 2008 low. A reading of more than 50 may be far in the future, but improved readings over the next several months may indicate that excess inventories are being exhausted.

The Conference Board releases its Consumer Confidence Index on the last business day of each month. The March reading of the CCI, at 26.0, showed a leveling off from several prior month's decline. A criticism of this indicator, however, is that during extreme economic environments such as the current one, the index tends to be caught in a feedback loop. As the economy worsens, the media focuses more and more on the downward trends, causing the confidence among consumers to reflect the media's sentiment. Small, positive changes in consumer spending will probably be a more reliable indicator of a rebound.

Historically, the stock market has tended to bottom out, on average, about six months prior to the end of a recession. While the market has had a sharp upturn since hitting its recent low on March 6, investors should be warned that it is not uncommon for a bear market rally to lose steam and reverse course. Nevertheless, at some point (if it has not happened already), the collective wisdom of those in the market will sense a fundamental turning point in the economic data that is reported, fueling a more persistent upswing for stock prices. Market technicians like to see strong, sustained trading volume during a rally before being convinced that the rally itself can be sustained.

While economists use these and other indicators to gain perspective on what lies ahead, not all economic data are predictive in nature. Perhaps one of the most prominent economic indicators, the unemployment rate, consistently lags the performance of the overall economy. From the mid-1940s through the early years of the current decade, a period that includes 10 recessions, the unemployment rate invariably spiked at a point in time after the economy began its rebound. So, do not expect the unemployment rate to improve anytime soon. A jobs-related change in data that could signal a shift in the broad economy is a stabilization and retreat of the number of initial jobless claims.

As the current recession already has lasted more than a year, we may be experiencing the longest economic contraction since the Great Depression. However, factors such as pent-up demand, fiscal and monetary stimulus and demographic forces eventually will move the economy back to its normal state of growth.

Many of the best opportunities present themselves early in a recovery. Therefore, it is in the interest of investors and businesses to pay particularly close attention to the subtle changes, or the change in the change, in the set of economic indicators that have historically had predictive value.