Jones
Nasdaq IXIC - Finding the 9 year cycleMarkets are more predictable than we have been led to believe. Here we are going to examine the 9 year cycles found in the Nasdaq composite.
This is a follow-up idea from my previous idea which was Lesson one in Market Cycles in the DOW JONES INDUSTRIAL AVERAGE. Please follow that link for a more detailed explanation on this.
In the Nasdaq we can see an (approx) 9 year half cycle which is very consistent. It actually is closer to approx 9 year 3 months. But you should know that the time between each line is EXACTLY the same. In the method I use, I use the fib time zone tool to create lines which all have the EXACT amount of time between each line.
As I said in my previous idea, there are multiple cycles on different time frames and different frequencies all occurring simultaneously. If we only focus on one particular cycle, we will not have enough information to know how to trade. But when we calculate the net effect of several cycles, we will have a much better idea and information for FUTURE predictions. Please read my previous idea for more info on that.
In addition to the 17 year Secular bull and Secular bear markets, we can see this 9 year (approx) cycle which also is present in DJIA.
The green line represents the LOW Point or trough of the cycle and the RED line represents the PEAK of the cycle. The GREEN ZONE starts at the GREEN LINE and goes to the RED LINE. The RED ZONE starts and the RED LINE and goes to the GREEN LINE. Remember that a GREEN ZONE will have stronger GROWTH - GREEN = GROWTH and RED = REST. But the 9 year cycle and 17 cycles are not the only cycles occurring. There are others. So the individual cycle will not explain all of the movements int he chart.
Can you see how near the end of the GREEN ZONE (before the red line) the growth gets stronger? And near the end of the RED ZONE, it gets weaker. Imagine this a cycle of fluctuating energy -- the green is a positive energy and the red is a negative energy. The energy is highest as we reach the end of the GREEN ZONE, and energy is lowest when we reach the end of the RED ZONE.
We will also explore other cycles and other charts soon. I will soon make a chart where I will show both the 17 year cycle and 9 year cycle on the SAME CHART. There you will see how when both cycles are GREEN the growth gets much stronger. Please STAY TUNED for more IDEAS.
I also will be analyzing BITCOIN using the same method. You may save my profile so you can see more ideas as I post them.
Please feel free to give your comments and click like if you like the idea.
DJIA Dow Jones - Market Cycles LESSON TWO - Studying 2 cyclesLesson Two
The market is more predictable that we have been led to believe.
We will now study the effects of both the 17 year half-cycle and the 9 year half-cycle which are occurring at the same time.
There are many other cycles or sine-waves occurring in DJIA and in other markets as well, but for now we will just focus on these two cycles.
Please see the Lesson One link below for an introduction to how market cycles work.
As I said in the other ideas, the Green line occurs at the trough (low-point) of the cycle and the Red Line occurs at the peak of the cycle. The GREEN ZONE is the period starting at the GREEN LINE to the red line. The RED ZONE starts at the RED LINE and goes to the GREEN LiNE. Growth is strongest in the GREEN ZONE, especially at the end of the green zone. Growth is weakest during the RED ZONE, especially at the end of the RED ZONE.
With TWO CYCLES, there are Green zones and Red Zones. When it is a time period where both cycles are GREEN ZONES, GROWTH is the strongest. When one is red and one is Green, the forces counteract each other. When both zones are RED, growth is the weakest and corrections are stronger.
All of the cycles are still part of a very long term growing economic cycle. It's hard to calculate when this long-term cycle began due to lack of data in the 1700s and 1800s. So due to that, it is hard to know when this long-term cycle will end. But this long-term growth cycle is what keeps the markets overall moving up, despite various corrections.
In this chart the SOLID GREEN Lines are the green lines from the 17 year cycle. The 17 year cycle is stronger, but it takes longer to complete. The DOTTED Lines are the 9 year (approx) cycle which I showed you on the Nasdaq. This 9 year cycle also fits the DOW, I suppose because they are both US Stock market indexes.
You can see how these cycles interact with each other. Growth is stronger when both cycles are green. The DOT.COM Bubble burst after both the 17 year GREEN cycle and the 9 Year Green cycle ended around the same time. They both went into a RED cycle until 2009 where the 9 year cycle became GREEN. The 17 year cycle did not become green until 2016, and afterwards the market growth really picked up. Now we are approaching the end of the GREEN 9 year cycle which ends around November 2018. Stay with my ideas and will will try to calculate shorter cycles to determine where the current market peak is going to end.
I think it points to a recession coming, maybe 2019. But due to the 17 year green cycle, it probably won't be end-of-the-world type market crashes. The 9 year cycle will be red until 2028 where it turns green. The 17 year cycle is green until 2033. There is still the possibility of doing something like the predepression bubble after 2028 when both cycles are green at the same time. Even if not like that, it is likely to have a bubble of some sort after 2028 due to both cycles being green.
Please click like if like the idea. Give comments or questions for clarifications how two cycles interact together. I hope I have explained this well enough.
Stay tuned, we will try to focus on a closer cycle to see if we can get a more accurate time period for a market top in 2018.
DJI: Dow Jones Seasonality StudyDow Jones DJI
The Dow was making a little continuation pattern as the last
session ended. It still looks vulnerable whilst trapped within
the pattern but it's sloping downwards so it still has a chance
of breaking higher later.
Whatever, it has to break above the upper small falling
parallel to follow long back to 24879 initially and then on a
break above here by 20 points or so to 24967-25078 range
again.
On downside it's likely to fall away to 24488 and when this
fails down through the support lines towards 23822 again.
Seasonality In Major Markets
We now have a seasonal pull beginning to work in opposition to price. 'Sell in May and go away,
come back on St Leger day' is an old stock market adage in London and by extension the US for a reason.
Up to 2015, in the 65 years since 1950, the US stock market has returned just 0.3pc on average between May and October.
That compares with a 7.5pc average return from November to April. This significant difference is the justification for the
age-old adage. St Leger is the day in September when the horse race of that name is run. It is the traditional end of the
season, short-hand for being out of the market during the less profitable summer months and fully invested in the winter.
This pattern of seasonality is very much present but not apparent every single year. That would be too much to expect.
Nevertheless, it's very much there, even if it does hide sometimes inside the noise.
The S&P 500 – A word of warningThe S&P 500 has experienced an incredible run ever since its low in 2009, surging from $652 to a top of $2869. That is an incredible rate of return totalling +340%. Or an annual rate of return just under 18% - and that still leaves out the return gained through dividends. I want to provide some word of caution in this post, looking at the graph and looking at long term average rate of returns for the stock market as a whole. The latter lies around 6 to 6,5%. Hell, you might even say 8% or 10% for that matter. The point is that, we have experienced a prolonged period now providing us 18% CAGRs. Of course, it depends on when you put your starting point, if you take the top of 2007, that CAGR is instantly quite lower. So, this by itself does not provide us enough information, but does give us a sense of how strong this bull market has been.
Now, I don’t want to overly focus on more than the mere technicals here, as they already speak for themselves:
1) TREND CHANNEL SINCE 2009 : Looking at the trend channel the S&P 500 has been in ever since the 2009 bottom, one can see it has been moving within its boundaries very nicely. HOWEVER, as of January 2018, we broke through the resistance and 2) ALMOST even touched the LONG LONG term (yellow) resistance line that traces back to 1982 . Needless to say that such a resistance is HUGE and not sustainable to break for even a short term. We didn’t reach it though – but it was close.
We ALSO went out of the white trend channel since 2009, which is also not very sustainable.
3) The reaching of this high was corrected rapidly and you can see the Fibonacci levels (drawn +- on the 2017 starting point) to which it retraced quite precisely. The very logic conclusion of purely this picture is that price HAS to stay within this white trend channel - unless a very short term temporary upward break-out, or a mid-term downward correction: We are therefore talking limited upward potential, and a lot of downward potential .
Looking at the white support, we see that 2300-2400ish is within a quite plausible first correction range. That would signify a healthy correction in a still upward trend channel.
In a more extreme scenario, you can see that the yellow support line is also exactly where the 2009 crash hit its bottom . For today’s chart, that would result in a downward potential up to $1000ish more or less (a bit more). I also highlighted the fibonacci retracement levels taking into account the 2009 market bottom. This gives us a bit more insight into the downward targets in case of a correction: $2398 (78,6%); $2029 (61,8%); $1770 (50%); $1510 (38,2%) and $1190 (23,6%).
4) Looking at stochastics, we see the monthly still in an upward trend, but that will inevitably make a death cross. 5) Moreover, RSI is heavily overbought at 87-ish.
6) We ALSO see a spinning top candle in the Heikin Ashi chart, which is a typical trend reversal indicator.
Conclusion:
I don’t think we are there yet in terms of a big market crash - momentum is still intact - but it seems we are reaching a – technical at least – market top with maybe 10% left and much more risk than reward…
Now, there will need to be some fundamental market catalysts to trigger any correction(s), but as the title says… this is just a word of warning, and we should never forget to have a look at the charts.
Feel free to comment / contradict / etc. - the better we are prepared together against any type of market movement, the better ;-)
And just as a closing remark - have a look at the daily where we just made a golden cross and have already gained a large part back from that recent "semi-flash" correction moment where the S&P dipped 7%!
Market's Support LineAs clearly shown on the chart, the market is not in a downtrend as many may suggest. It has rebounded off of the underlying support line multiple times yet to break through. However, if it does make it through this point, it could very well go into a free fall towards the previous support dating back to 2016.
DJIA - The actual bad techWhen you've been in the crypto space for some time one is probably familiar with the analogy "bad tech". Pointing towards the big upswings followed by often huge selloffs in Bitcoin. Well, today my friends, we have an example of actual bad bad tech, the hyper bubble, bubble of all bubbles: the stock markets.
- There is no reason, to be upset my friend.
DOW JONES Daily Update (26/2/18)More upside to go.
price is at a no man land.
I would not look for any trades at the moment.
Too late to long , too early to short.
At least 26k before we have some possibility to short
Disclaimer:
The information contained in this presentation is solely for educational purposes and does not constitute investment advice.
The risk of trading in securities markets can be substantial. You should carefully consider if engaging in such activity is suitable for your own financial situation.
SonicR Mastery team is not responsible for any liabilities arising from the result of your market involvement or individual trade activities
DOW (US30) - 1D - Slightly different to NASDAQIf you like this idea leave a like and follow me to get all of my updates :) I would love to talk to you so send me a message or comment!
Underlying: US30
Time frame: 1D
So I have just posted about the NASDAQ and noticed that the DOW chart is slightly different to it (I will post the NASDAQ chart below). On the original chart you can see the NASDAQ breaking out two days ago of its wedge formation however, the DOW does not have that same formation. More often than not you will get a similar correlation with major stock indexes.
Is it possible that people are moving money out of "growth" stocks and moving their money into more of the age old "defence" stocks or the "big boys" of the market i.e. IBM etc. That could possibly explain the over-performance of the DOW in comparison to the NASDAQ. Interesting times are ahead!