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.
Wednesday, May 11, 2011
Comments and 05-12-2011
Today was as expected in yesterday's post. The day was down with a small bounce toward the close. Tomorrow is less clear. I believe we may get a small down tick early and then turn up for the remainder of the day. The 22TD cycle is down, the 11.2TD cycle topped and turned down. The 5.6TD and 2.8TD cycles turn up early in the day (if not before the close). So that gives us the two longer cycles down, the two shorter cycles up. I expected the shorter cycles to win as they turn quicker and that we will have an up day. I do not believe it will be a big up day, but up 5 or so points.
Of course the risk/question is when does the 22TD cycle gain enough momentum to dominate? We should be approaching that point (so there is a good chance we do not get the expected up move).