Once oil rolls over the model resumes.  Why oil?  Oil is the global liquidity indicator and also drives inflation. The best time to profit is when the Fed “shakes the tree.”

The indicators for the model (OFC) are:

Oil 200dma +-          (Oil above or below 200dma)

FPC + – NC Zero        (Fed Policy Change : plus, minus, no change, zero bound)

Calendar after holidays (Jan, Sep-Oct)

Best conditions to short SPY in order are-

1. Oil 200dma- , FPC +                                      Sep-Oct 2014, Jan 2016
2. Oil 200 dma-, FPC – (recession year)         Aug 31-Oct 21 2008
3. Oil 200 dma+, FPC- (recession year)         Jan 2008

No Go SPY short conditions-

1. Oil 200dma+ , FPC +                                      2006, Jan 2017                                               (SPY can still fall but only 2-4%)
2. Oil 200dma+, FPC NC                                    Jan- Sep 2007

TLT long conditions-

1. Oil 200dma-, FPC Zero                              Nov 2008 (after SPY crash), Jul 2011, Jan 2015, Nov 2019/2020?
2. Oil 200dma-, FPC +                                    Feb 2016 (after SPY -10%, 2 wks only)

In general, the USD trend precedes the oil trend by 3-6 months. So USD can be used as a leading indicator.