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When calculating the moving average from the FRED unemployment data, do you include the most recent month in the 12 month average (current month/average of current month plus preceding 11 months) or is the current month compared to the average of the preceding 12 months?

The SMA signal is the moving average of the S&P500. I use the 43 week (~10 month) moving average.

The FRED signals are the most recent month compared to the one 12 months ago. YOY = year-over-year.

Note that the FRED data gets updated around the 15th of the month, so you are always 2-4 weeks behind. But that's okay, it's Good Enough(tm).

A negative SMA of the S&P500 is the signal; the FRED data is the gate which determines if you should ignore or obey the sell signal.

You'd have to read the paper: "Growth and Trend: A Simple, Powerful Technique for Timing the Stock Market Posted on January 18, 2016 by philosophicalecon@gmail.com" to fully understand the logic.

Basically, the plain SMA going negative timing signal is too aggressive---it takes you out sooner and much more often than is optimal. In my earlier testing I came up with a couple of ways to tame that, to improve it. One was to wait for the SMA to drop below 4% the current price. The other was to wait for 4 successive weeks of SMA below current price.

The FRED gate works better. In my backtests.
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