Duck and Cover?

Momentum divergences are a good indicator of weakness and warrant serious attention. In the clips below I highlighted the situation today as well as similar divergences going all the way back to 1990.

This indicator isn't perfect, but even if you took short positions, you wouldn't have been hurt much after false signals. Obviously it makes sense to use tight stops because if you're wrong, you'll find out very soon after a position is taken.

When my timing model is signaling a heavy equity allocation, as it is right now, I'll use a double inverse fund as a hedge.

The hedge is on.