Market Timing with Moving Average Envelopes

I was reading Barron’s last week. One of the articles I read made reference to a simple system for timing the market. This market timing system was simply a 200 day moving average with a 5% band above and below the moving average. A buy signal occurs when the market closes above the upper band. The lower band is used to exit long positions.

The system generated two signals over the last two years. It generated a sell signal on January 4, 2008 and kept us out of market until a buy signal was generated July 15, 2009. This is just one more simple system that will keep you out of the market during severe market declines.

This is just one more system that we will be tracking at BuyandHoldisDead.com. Sign-up now for your frequent free weekly updates.