Saturday, July 2, 2011

07-2011 the month of July

Would it be interesting if we have seen the highs for the month of July already?  Could happen, but we probably get enough upside Tuesday morning to keep that from happening.  The most interesting cycle in July will be the 22TD cycle.  This cycle has shown enough volatility (amplitude) to dominate in July.

The 22TD cycle should have topped and be ready to turn down.  With an amplitude of 75 points (estimated) by mid-July that could take the market back down under 1270.  The second most interesting cycle is the 20week cycle.  It has an amplitude (estimated) of 87 points.  That is about 1.75 point per day over the 10 weeks (the down leg) or about 19 points over 11 days of the 22TD cycle down leg.  That combined with the 22TD cycle could put the market at 1245-1250 by mid-July.   Now I am not certain of the impact, but the 1 year cycle is ready to bottom and may add another 15 or so points of downside next week.  After mid July the 22TD cycle should recoup a lot of the downside back up to the 1290 area by the end of July is my best estimate.

So in mid July we should be around 1245 (and maybe 1230).   Looking at the FIBS I believe the maximum upside target should be 1361.06 (but may be 1341.67) and the minimum downside target should be 1328.18 (but may be 1247.56).  Here is a fibs table: 

Here is a chart of the SPX highlighting the 22TD and 20 week cycles:
Note the target using DPO to estimate amplitude down from current levels gives a target of 1225-1235.  If we go up another 10 points from here the raise that downside target 10pts etc.  But the downside target is consistent with  with the FIBS mentioned above.

GL traders.  Is there a 4th of July bear out there.  I guess we will see.  Do your own analysis, this should only be one data point in your analysis.  Happy 4th....

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