A brief update on two TrendFlex Indicators that are beginning to support a tactical move to hedge long equity positions.
Note below that the TrendFlex Classic CR (Credit Risk) as shown in the chart below is beginning to converge with its moving average line (see solid black line and dotted blue average line). A close below the moving average would signal a sell signal for equities. Classic CR is a short to medium-term market trend indicator.
Here we have the NYSE Summation Index. Note the rectangles- the one on the left shows a bullish trend (S&P 500 is green line) while the red NYSI line is above the 400 level, and conversely (rectangle on the right) when the NYSI is below 400. Market timing is not perfect here, but it does provide us a sense of the risk character of the current environment.
It may be time to hedge longs, especially as we get closer to the general election. A short position or two in e-Mini S&P 500 futures can provide a bit of cushion to long positions.