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THen what? Do you just stay invested while your "preferred" signal stays bearish?
What happens the day the $$$ you "put back in" falls into loss territory AND your "preferred" signal is still bearish?

Yes. The money you put back in on the terrible breadth days stays back in no matter what.
Maybe you lose another 40% of it, I don't know.
But compared to always being invested, there should be an improvement, since presumably the terrible breadth days occur when the market is lower than your sell point.

Mungo suggests that the validity of the bottom signal decays over time. So whatever you put back in you could pull back out 1/3 after one month (if the other signals remain bearish), 1/3 after two months, and 1/3 after three months.

Yes, this is one possibility.
There are definitely implementation problems with what I'm talking about.
It's just trying to make mechanical what Mungo posts so often about: selling around the approximate top and putting money back in when there's blood in the streets.
Easy to say and hard to do.

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