Thursday, July 14, 2011

Comments and outlook for 07-14-2011

If you had looked at the futures yesterday after the close (after Moody's put US treasuries on a watch) you would have thought today would be a big down day.  I sold some QID about $1 above the close. Yet, this morning the market looks flat to slightly up.

Here is a visual:

Looks like the 34TD cycle is down.  The 22TD cycle should be bottoming by/before the end of the week.  Some of the shorter cycles should bottom during the day.  Based on this visual one might expect some weakness mid day and some recovery by the end of the day.  So flat to slightly down would seem to be the most likely outcome for the day.

GL traders. Do your own analysis.  Take a look at Shadow's comments.


  1. I recounted and found the 70TD and it's 35TD inner cycle.
    I also agree with you that the 22TD started on 6/16 and the 34(35)TD started on 6/27.
    So the 22TD should be bottoming either tomorrow or Monday.
    The 34/35 will be topping on the 20th.
    So instead of the 20th be a big red day it should be a big green day because the 22 and 34 TD will be working togother between the days of Tuesday and Wednesday.

  2. This is a revision to the critical dates post - thanks to Inlet for his continuing this wonderful blog:

    • March 16th – Last time the 70TD bottomed.
    • The pattern during this 70TD cycle could be repeated (but I don’t think so…but just so all the cards are out…the potential is there).
    • June 16th 22TD Restarts

    • June 27th – 35TD / 70 TD (not 33TD/64TD) bottoms and starts anew.

    • July 12th Earnings Season Starts
    • July 15th – 18th - Option Expiration
    • July 15th -18th (all depends on if July 4th is counted) - 22TD Bottoms/Restarts within the downside of the 35TD….should be a bloody day[BEG] (s). There will be a battle here…some sideways action…this is when things will be told. Last time the 35TD and 22TD met up was last earnings season and the market reversed and took off...if it does then we go over 13,000. But....If we keep going down after (12,290) that then it's to 11,400. This chart shows that this would be in line with the 2010 1 year pattern/cycle. At this point I think the 22TD will take over and we will go up until it turns down. The anomaly here is the 20WK Wall Cycle which is down and was up last time.
    • July 20th (not 8th) – 35TD Tops – Should be a BIG GREEN DAY as the 22TD and 35TD are working in unison.

    • August 2nd - 22TD Bottoms, 35TD is down (7days), this would be an down day. Debt Ceiling Vote….I think.
    • August 5th – Monthly Jobs Report August 12th -34/35TD bottoms, and 70TD Cycle Tops
    • August 17th – 22TD Tops – within the 70TD going down. Anything after this is down red days.

    • September 1st -22TD Bottoms and starts fresh.

    • September 6th- 35TD Tops. Down red days continue.

    Cycles are bottoming almost the same time – should be bloody unless QE? Is suggested prior:
    • In any of the scenarios the rubber meets the road during this time period.
    • September 16th – 22TD Tops – OEX - Quadruple Witching
    • September 27th – 35TD/70TD Bottoms
    • So the end of September will be when the house will be burning…and after that we run.
    • QE Something has to start….most likely a hint of this will need to occur prior to this triple cycle bottom time period.

    Footnote: My opinion the 70TD(98CD) cycle is a combination of the intermingling of the 22TD(30CD) / 35TD(49CD) Cycles.

  3. Question to Shadow7: If I'm reading your statements correctly, it sound like you think the mkts will be going down for months, with some green days, of course. What is the reasoning, cycle wise for this thought? If the wall cycle and the 1 year cycle are bottoming this month, shouldn't the mkts be going up into the end of the year? What other cycle are you applying? TIA

  4. I see us in a choppy trade through September. Because of the bottoming of the Wall and 1 Year cycles. Actually I thought the 1 year should have bottom July 7-8th..but I don’t see any evidence. June 16-27th so far seem to be bottom…but I don’t think this was the bottom for the 1 year. Inlet any thoughts? After September I see us making huge gains all the way into 2012 (Spring-Summer) followed by an equal weighted fall into 2014 and not find a bottom until 2016. My research (incomplete) has found the following:

    • 10 Year Bottom/ Restarted in 2004 – It peaked 2009 and will bottom 2014.
    • 8 Year Bottom/Restarted in Sept 2006 – It peaked 2010 and will bottom 2014.
    • 6 Year Bottom/Restarted in Sept 2008 – It will peak April 2012? And will bottom 2014.
    • 4 Year Bottomed/Restarted in Sept 2010 – It will Top April 2012 And will bottom 2014.
    • 2 Year Bottomed/Restarted in Sept 2010 – It peaked May 2011 And will bottom 2012 and again 2014.
    • 1 Year Bottomed/Restarts annually in July – September.
    • Read this:
    And I think we have a Grand Cycle bottoming in 2016.

  5. To follow up I see most of the month of July as down and most of August being up. I've attempted to forecast using an Excel Chart....needs more work...I need to figure out how to show dates.

  6. Shadow - thanks for the chart. For convenience of blog readers I copied it to the blog. Maybe you can offer some comment on how to interpret the chart there.

  7. As to cycles -

    The 1 year cycle did not show much in the way of downside this year. The amplitude of cycles expands and wanes (I am guessing the 1 year is somewhat dormant currently).

    it is my belief the 10 year cycle runs 1982-1992-2002-2012 (bottom to bottom).

    6 year cycle - 2008-2011 is 3 years (Cliff Droke noted cycle analyst says this one should top in the Sep-Oct time frame this year and the 6 year cycle top usually marks a major market top)

    I believe we will have the 10 year, Kitchin (41 month) and 2yr cycle bottoming in close proximity in 2012 giving us a preview of the coming Super Cycle bottom in 2014.

    Currently we have a somewhat different view of 2012. I am open to changing my opinion if the data suggest I need to do so. Let me know what you come up with as you continue your research.

  8. Shadow -

    I hope you realized that
    was from 2009. Droke has more recent articles (google him) that you may want to read.