Two-mode momentum rotation: in uptrends, own the 4 defense/industrial stocks with strongest 14-day momentum; in downtrends, own 1 defensive/bond ETF with weakest 10-day momentum. Daily rebalance with equal weights; signals use ITA trend (50 vs 200-day MA) and RSI screens.

Two-mode momentum strategy. 1) Growth/uptrend mode: If ITA’s 50-day price average is above its 200-day average, scan a list of defense/industrial stocks. For each, calculate RSI over the last 14 days. Pick the four with the highest RSI (strongest momentum) and allocate equal cash across them. 2) Defensive mode: If ITA’s 50-day price average is not above the 200-day average, switch to a defensive basket of bond and sector ETFs. For each, calculate RSI over the last 10 days. Pick the one with the lowest RSI (weakest momentum) and allocate cash equally to it (effectively a single-position sleeve). Rebalance is daily. The strategy replaces BIL with the Safe Sectors or Bonds group; no changes to AR or DD. RSI is a momentum gauge; higher RSI implies stronger recent price movement, lower RSI implies weaker momentum. The ITA trend check is used as a market-state indicator to switch between growth and defense. Asset universe includes major defense names like NOC, RTX, BA, LMT, GD, HWM, LHX, etc., and safe-bond/defensive ETFs like TLT, LQD, BSV, XLV, XLP, SPAB, ANGL, XLU, UGE, VBF, etc.

Out-of-sample tests show this two-mode momentum strategy outperforms the S&P 500 by catching more upside in uptrends and reducing drawdowns in downtrends, using ITA trend signals and RSI-driven rotations with daily rebalancing.