This scenario occurs when a fund with a BUY signal moves down, has a new OUT signal and gets replaced by another fund with a new BUY.

The normal procedure would be to shift your money from the first fund that dropped down into the fund that moved up. That’s the “rotation” part.

It is often advisable to wait for another week or two and compare the charts of the two funds before rotating.  Sometimes two funds that are marginally different will shift positions one week then two weeks later shift back. There’s no use making unnecessary trades, so you might wait until the two funds are 2-4% apart before shifting.

On the other hand, if the two funds are different (e.g. corporate bonds and Japan equities) and they shift positions, it can be more effective to rotate earlier. It’s your call.

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