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.
Tuesday, January 17, 2012
I have been searching for an explanation of the data in terms of cycles for weeks now. I was looking at David Knox Barker's recent depiction of the Wall Cycle:
OK, so this explains it - sort of. The thing that caught my attention was the short QW3 cycle at the end of November and early December. This had always been difficult to explain. It is about half the other cycles. If you do much research on cycles you will find some cycle analysts talk about cycles inverting. In my experience this is not a common occurrence, but I do not discount the possibility. We were going along with cycles averaging about 33-34TDs and we get a 17TD cycle. This shifts the cycle tops and bottoms 1/2 a cycle and the top is where we had projected a bottom and the bottom is where we had projected a top. In other words the cycle had inverted. Here I show that:
If Barker's interpretation is correct and we had a cycle inversion (as it appears we did) then we should be topping and head down into early February. GL traders.