01-18-2012 outlook

I have been searching for an explanation of the data in terms of cycles for weeks now.  I was looking at David Knox Barker's recent depiction of the Wall Cycle:

OK, so this explains it - sort of.  The thing that caught my attention was the short QW3 cycle at the end of November and early December.  This had always been difficult to explain.  It is about half the other cycles.  If you do much research on cycles you will find some cycle analysts talk about cycles inverting.  In my experience this is not a common occurrence, but I do not discount the possibility.  We were going along with cycles averaging about 33-34TDs and we get a 17TD cycle.  This shifts the cycle tops and bottoms 1/2 a cycle and the top is where we had projected a bottom and the bottom is where we had projected a top.  In other words the cycle had inverted.  Here I show that:

If Barker's interpretation is correct and we had a cycle inversion (as it appears we did) then we should be topping and head down into early February.  GL traders.

the week of Jan 17 2012

I wish I could get a clearer reading on what is happening in the market.  At this time though I find no cycle combinations that seem to explain the market action.  Doesn't mean there isn't an explanation, just means I am unsure of what it is.  January is starting out the year showing strength (same as last year) - so maybe there is a one year cycle in play.  No high level of confidence in that.

Based on my cycle work I believed we would have topped by now (and maybe we did Friday?) and be showing weakness.  It seems we have achieved the levels (or more) one would expect from the amplitude of the DPO.  The CCI seems to be indicating a possible top.  Some other technical indicators like the MFI are also at extremes.

So what would it take to turn the market.  I suppose a bad report from a major company like IBM (the model of consistent performance) which has a new head that decides to do some house cleaning might do the trick.  All we can do is wait and see.

GL


 

Spiral dates top

Spiral dates says Jan 14 ideally will mark a top.

http://spiraldates.com/2012/charts/sp500_010612A.png

The Jugular/Kitchin cycles bottom 2012

This is a preview of the coming K-Wave winter?

http://www.financialsense.com/contributors/chris-ciovacco/2012/01/06/yields-cycles-sentiment-say-gains-may-not-last

01-09 outlook for the week

We should have a longer multi-week cycle bottoming by the end of the week.  We have two multi-day cycles that appears will bottom by Thursday close.  We have a short cycle up two days then down two days into Thursday close.  For the week expect a low Thursday with a bit of recovery on Friday.

Here is the SPX:

Gl traders

Always question everything.

I like David Knox Barker and his work.  I have repeatedly talked about the Kitchin and Wall cycles.  The one thing that bothers me about the Wall cycle (and his interpretation) is the variability he claims it has.  That can lead to a lot of personal bias and interpretation.    He gives a "typical" range of a Wall cycle of 8-32 weeks (that is a lot of range and leads a lot of room for personal biases/interpretation).

Now I believe we should interpret the data not insert our preconceived personal biases into our analysis.  So I have been thinking about this interpretation for a while and whether it is useful in interpreting the data.  I have come to believe it is of limited usefulness.  So I have looked at the data (several times) to see if there is an alternative interpretation to better explain the data.  Terry Landry of T-Theory  seems to favor a 15 week cycle.  There are 12 - 15 week (12 x 15 - 180 weeks) periods in a 42 month (Kitchin - 3 years 6 months or 3 X 52 + 26 = 182 weeks) cycle.  Here is a chart showing these 15 week cycles:

Seems to me this interpretation offers a more acceptable level of variability in cycle length than the 20 Week Wall cycle.  It still points to a low in mid January.  Always question everything/everybody and focus on whether the market data supports the interpretation.  Your feedback can help keep me on track....  

01-03-2012 outlook

How do we start the new year?  The evidence suggest we start the new year by pulling back the first few trading days and set a bottom by around Jan 11. 

Tuesday could well kick off the down side move.  Here is the SPX and my interpretation of the cycles:

GL traders.  May 2012 treat you kindly.