Saturday, October 30, 2010

The longer term outlook

If you have followed my posts you know I expect a 3.39 year cycle to top around Nov 19.  This is 40.68 months (commonly referred to as a 40 month cycle).  There is a 24 month  cycle that tops/bottoms alternately in April each year (recall the top in April this year?).  These 2 cycle could be the dominant cycles over the next year. 

I have tried to give you a visual of these cycles and how the align during the next few months....

As you can see the top of the 40 month cycle is upon us and ready to top and reverse to the downside.  The 24 month (2 year) cycle is already down and should bottom in April 2011.  So starting in December the cycle environment should reverse the current trend.  Note:  This does not adress shorter cycles like the 45 day cycle which should have bottomed and will be up throughout November and down in December.

So what is the combined effect of these 2 dominant cycles:  I have tried to give you a visual of the expected impact...

As you can see the combined impact of these two cycles should be "bear" friendly in 2011 and even into 2012.

1 comment:

  1. give me an idea on near term oil cycles when you get a chance........