Tuesday, October 11, 2011

10-12-2011 outlook

It appears the 11.2TD cycle topped in the AM on 10-11-11 as shown on my chart.  This suppressed any move up. 

So how does this work?  Let's suppose the 11.2TD cycle has an amplitude of 110 S&P points.  Then it moves the S&P 110 points over a 5.6 day leg up/down  (about 20 points a day move on average).  So that gives us up to 20 points of downside pressure.  At the same time let's say the 22 day cycle is up and it has am amplitude of 110 points.  This is about 10 points a day move over 11 days (the length of an up/down cycle leg).  So if we have 20 points of downside pressure and 10 points of upside pressure or a net of 10 points of upside pressure.  Finally lets suppose the 34TD cycle (also up) has an amplitude of about 100 points.  Over 17 days (the length of an up/down leg) that is about 6 points of upside pressure a day and cancels out all but 4 points of the 11.2TD cycle downside pressure (when combined with the 22TD cycle).  Since the 11.2TD cycle was  only for a partial day we get a flattish day. 

I have been asked if my interpretations are somewhat subjective.  Yes, they are - but I try to honestly interpret the data in front of me.  The above illustrates the type of things I try and consider.  Of course nothing is static in the market so understanding when a change is happening and interpreting that change is subjective and at times I will not do that correctly.  That is one reason (of course there are many) you should do your own analysis.

So given the current alignment of cycles I believe tomorrow should be down.  Not a huge move down, but still up to 10 points or so.  Here is the swing trade SPX cycles:

GL traders.  Do your own analysis.


  1. Phil Davis believes the S&P will fail again @ 1200 range. I believe he is suggesting a position in SDS.

    The futures are green so far, so looks like a positive open. Thus, perhaps up in the morning & down in the afternoon.

    I think I might close my SVM calls & perhaps buy some SDS today. Let's see how the morning goes.

  2. Inlet any idea as to what GOOG may do?

  3. c88 -

    I do not follow GOOG closely, but a quick look at the chart leaves me unimpressed with it. Do you have an opinion?