Subject: Re: Bear Catchers
Said, take a look at the FAQ & linked posts to get a good overview of how to best use the BCs, generally and a couple of them specifically.

http://mechinvesting.wikidot.c...

With the short-lived 'triple-bull' 3/24/22, IF one were following the original method of using the EMA9 on the NHNL on CLOSE, that signal never went bullish. I don't follow the GTR1 version of NHNL so I'm not sure what it's doing.

SMA and DBE are the two slowest reacting signals. They are not designed to be short term trading signals. Because as Zeelotes pointed out years ago, one of the worst ways to destroy your rate of return is to get out of the market too early. So, they are designed to minimize whipsaw. But whipsaw still happens.

You call 8/5 'the perfect wrong time'. But that's in hindsight. There was enough buying going on in the market to push the NHNL to bullish (for about a week). As the shortest-term signal of the 3 it can get flipped with shorter term improving breadth. It's also the only one of the 3 that measures market breadth - which makes it a great complement for the other 2.

You understand that if the events had happened differently (interest rates got slowed down, inflation suddenly dropped, the Ukraine war ended abruptly) and the market had gone UP at that time, it would have been a GREAT time to get in and the NHNL would have been the harbinger - also in hindsight.

With one of the 3 bullish, generally the way to use that is to consider *gradually* increasing equity exposure if comfortable with it in case the market really is 'recovering' - but it's not predictive, nobody knows! These are consensus indicators.

If they're too slow for your personal preference - 'far too late to be useful', then begin using additional methods - some of them touched on in that page - to build out an approach you're more attuned to. I simply limited my portfolio losses to 5-7% in the first part of the year while the market went down 15%+.

These particular signals are intended to prevent big losses from big, long-developing & lasting bear markets. Knowing what to do at the hard right edge of the chart is difficult.

FC