As mentioned on www.tsptalk.com/sentiment.php, we are implementing news rule to the Sentiment Survey System, which will now determine if we are in a bull or bear market before determining the ratios used for the buy and sell signals.
Bull Market Rules: If the 50-day exponential moving average of the S&P 500 is above the exponential 200-day moving average, we will use the following rules:
When the Bulls to Bears Ratio is:
* 2.00 or higher, it is overly bullish, which is bearish for the market and we have a sell signal.
* Less than 1.25, it is overly bearish, which is bullish for the market and we have a buy signal.
* A buy signal means 100% S fund the following week. A sell signal means 100% G fund the following week.
Bear Market Rules: If the 50-day exponential moving average of the S&P 500 is below the exponential 200-day moving average, we will use these rules:
When the Bulls to Bears Ratio is:
* 1.00 or higher, it is overly bullish, which is bearish for the market and we have a sell signal.
* Less than 0.50, it is overly bearish, which is bullish for the market and we have a buy signal.
*A buy signal means 100% C fund the following week. A sell signal means 100% G fund the following week.
The reason for the change is because in 2008, the ratio never reached 2.00 so it has been on a buy signal, and 100% S-fund all year. Obviously this is unacceptable.
Bull Market Rules: If the 50-day exponential moving average of the S&P 500 is above the exponential 200-day moving average, we will use the following rules:
When the Bulls to Bears Ratio is:
* 2.00 or higher, it is overly bullish, which is bearish for the market and we have a sell signal.
* Less than 1.25, it is overly bearish, which is bullish for the market and we have a buy signal.
* A buy signal means 100% S fund the following week. A sell signal means 100% G fund the following week.
Bear Market Rules: If the 50-day exponential moving average of the S&P 500 is below the exponential 200-day moving average, we will use these rules:
When the Bulls to Bears Ratio is:
* 1.00 or higher, it is overly bullish, which is bearish for the market and we have a sell signal.
* Less than 0.50, it is overly bearish, which is bullish for the market and we have a buy signal.
*A buy signal means 100% C fund the following week. A sell signal means 100% G fund the following week.
The reason for the change is because in 2008, the ratio never reached 2.00 so it has been on a buy signal, and 100% S-fund all year. Obviously this is unacceptable.