Post #4569 by BenSolar on the Mechanical Investing board

Investment Strategies / Mechanical Investing

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The ol' dashboard is signaling "correction mode" - when most intermediate term indicators are bearish. All global equity major asset class indexes are between 5 to 7.5% off their highs. The longer term BearCatchers -- SMA Slope, DBE, "26w/52w" -- are bullish and will be for at least 2 months (barring a Covid or T-tantrum crash).

What are your plans?

                Intermediate-Term	-6	BEARS/TOP	BULLS	AS OF
BearCatcher	Nasdaq New Highs/New Lows	Bear		        11/5/25
BearCatcher	SMA Slope, S&P 500		                Bull	10/17/25
BearCatcher	Dying Bullish Euphoria comb.	                Bull	7/23/25
	
Momentum, Int	26W / 52W		                        Bull	6/26/25
Momentum, Int	DMI			                                8/15/25
Momentum, Int	10/50 Crossover	                Bear	        	11/17/25
Momentum, Int	PPO Weekly	                Bear		        11/7
Momentum, Int	Above 20 & 50	                WkBear		
Breadth, MT	PAMA Naz 50	                Bear		        10/31
Breadth, MT	Breadth Confirms	        Bear		        10/29
Breadth, MT	Naz Bullish %	                Bear		        11/7
Breadth, MT	S&P PAMA 200	                Bear		        10/29/25
Breadth Thrust	Breadth Thrust			
Correction Mode	>7% off last peak		                 Bull	11/20/25
Interest Rates	Corporate Bond Index			                10/31/25
VIX	Volatility	                        Bear	        	11/14
Valuation	Sjuggerud mod		                         Bull	5/12
Hindenburg	Omen	                        Bear		        10/30
BearMktWarning	(NazComp)	                Bear	(constantly bearish unless at long-term lows)
Timing, SeasonalMACD on RUT		                 Bull	        10/27/25

Short Term	Short Term/Top Warning	2		
Momentum, ST	PPO Daily	                Bear		        10/24/25
Breadth, ST	SP600 PAMA20			                        11/21
Momentum, Int	# 26 week highs			                        7/10/25
Breadth, ST	PAMA5D %OFF 21dh			                11/18/25
Top, 	        PAMA Divergence Highs	        Bear		        10/29/25
Top	        PAA Count			                        10/24/25
Top, breadth, ST Trigger Security			
Top	        Recent Simple Top			                10/24/25
Top	        Primary-Tech Divergence			                8/23/24
Bottom	        Extreme PAMA low		Off	-
				
Leverage, Macro	Margin Debt to GDP	        Bear		        9/30/25

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No. of Recommendations: 8

I took your post as a prompt to review my portfolio, and I identified one holding that was a big gainer for me but that now was valued as a pricey growth stock instead of a value stock. So, my investment thesis for the stock was no longer met and I sold it. Hate to see it go, but I don't think the valuation was justified, and with the over-all market extremely richly valued and maybe looking toppy, and I'm happy raising some cash to be held for re-investment on the next big dip.

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And as it turns out, this time bearishness was the wrong guess as "everything" this week bounced back 4-5%. Whatever reason for the across-the-board selling in the 2-3 prior weeks, of which we can all make educated guesses, it was over and reversed first thing Monday. Most indexes bounced off their 20DMAs if not their 50DMAs.

Now we are back in "Neutral". These are "interesting", fast, megacap-tech dominated equity markets. 50DMAs and 20DMAs seem to be important technical levels.

FC

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No. of Recommendations: 13

The two FRED indicators are still signaling no recession.

RRSFS and INDPRO are both up YOY. So stay invested.

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