This is just a guess but it could be a mis-wire. Check the indicator wires are plugged in to the proper wires. I know on the mid to late 80's XT's the indicator in the speedo is wired across to the "hot" side of the left and right turnsignal wires. The bulb voltage in the speedo is very low but when either left or right side is selected the indicator bulb in the speedo grounds thru the filements of the non selected side. If something was mis-wired in this area may explain your problem.
Another bit of info, if you have a different wattage bulb in one or both of the turn signals the flash rate will vary. If memory serves, you need 27 watt bulbs in all 4 turn signals (indicators) and a special bulb in the speedo indicator...
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'84 XT600 is now bored to 2nd oversize and new OEM pistons and rings installed. No more smoking.
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