This strategy is based on a straightforward price vs 200 day moving average, plus a confirmation using FRED economic data.
The model sold three ETFs at month end February:
- MUB (municipal bonds)
- XLU (utility SPDR)
- EMB (emerging market bonds)
There were no new BUYs in the period.
This action makes sense. The model sold international Bonds (BNDX) February 1 and VCLT (long term bond) on February 1 as hints of inflation began to percolate. These additional bond actions are in keeping with the theory that inflation will begin to creep up due to post-COVID demand, additional economic stimulus, and scarcity in housing and certain large goods such as used cars, appliances and the like. The idea of a $15 min wage and a stimulus check will put additional labor rate pressure at the low end.