Longer term we have a 40.68 month (3.39 yr) cycle set to top in 2 weeks around Nov 19. This will lessen upside momentum and in December may even add to downside pressure. In mid January we have a 1 year cycle topping and turning down. We also have a 2 year cycle down into May. So sideways to a bit up thru November, sideways to a bit down in December. Then we get a sizeable downturn starting mid to late January which will last into early to mid May.... Here is a how it looks visually the next 2-3 months.
Cycles are a tool and should not be used to the exclusion of other tools. There is always the possibility (high probability long term) that the data will be misinterpreted or a relevant fact over looked. So use cycles to check your analysis, not as the only reason to make a decision. Interpretation is the opinion of the author and may be incorrect and should be viewed in that light.
Saturday, November 6, 2010
11-07 cycles weekend update
Monday by around 12:00-1:00 pm we should have a 5.5 day cycle turn down. This (along with one other shorter cycle down) may give us a pullback into Wednesday close. I do not expect it to be more than a moderate pullback of 15 or so S&P points. Here is a chart showing 2 short cycles:
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