Sunday, January 8, 2012

Timing cycles

Cycle analysis can be great for timing bottoms.It is important to note that cycles are classified by either left translated or right translated and apply to any time duration.  Lets start with the larger cycles and work our way down so you can see their relationship. An intermediate cycle completes itself anywhere between 16-22 weeks. Most left translated intermediate cycles peak between 4-10 weeks and almost always move below their prior cycle bottom. Our current cyle peaked on its 3rd week and remains extremely left-translated unless a breach of 1292 is to occur next week. Do understand that the first two daily cycles of the four that make up an intermediate cycle are usually right translated. It is getting oftly deep into the timing band for a daily cycle low with this current daily cycle now on day 27. Stocks are due to move into their daily cycle low at any point now and should reach its bottom within 8-18 trading days. It remains to be seen whether stocks can still push higher, but the longer stocks stay up here the harder and faster they will fall, so keep that in mind. In order to complete this intermediate cycle, stocks will have to spin out one more daily cycle, and it is this daily cycle that generates what is known as the intermediate cycle decline. This type of decline will be of greater selling pressure and more similar to a panic selling type of event. This daily cycle should also be very quick in its rapid descent but importantly, it will establish a new bottom. 
One more thing- the fact that this current cycle research now has a crash type scenario in play goes hand in hand with the Elliot Wave primary 3rd down. That never existed until now.

Cycle work for S&P

Cycle Work for the U.S. Dollar 
The Dollar is on day 3 of its current daily cycle. It now has at least 9 more days to rally before seeking out its cycle low. Although with its recent aggressive upward move, I wouldnt be surprised if it took a breather for a day or two.

Expanded Bear Flag pattern 
Wave C is coupled with extreme optimisim and convincing bullish croud sentiment.

Mirror Image Foldback pattern Pt.1
These patterns are clearly identifiable and similar in their symmetry.  

For longer forcasting purposes this technique can be extremely accurate.



The VIX Daily Chart
Notice the VIX drifted quietly sideways before it violently reversed back in late July. This quiet decline could reverse at any time.

No comments:

Post a Comment