Tuesday, December 21, 2010

It is Time to Pay Attention.

The chart below shows the Gann Square of Nine levels emanating from the Aug 27 low @ 1039.70.
  • The 360* (2 squares) is 1172.68 which is near the last pivot on Nov 116th low at 1173.00. This is clearly an important level in the current structure of the advance.
  • The 180* (1 Square) is that 1105.19. The area between 1105-1115 has been mentioned numerous times over the last few months. The four times since April that the S&P has declined through this level was during high periods of volatility. (May 20, June 22, July 29, & Aug 11.) 1105-1115 is an critical area--if the S&P were to decline below 1105 alarm bells should go off.
  • The 540 level is at 1242.17. This area may provide resistance--especially seeing that the S&P has reached the anticipated 1250 level on an Energy Date. (Dec 21-22.) When prices are harmonic with dates the markets often turn--or sometimes accelerate.
  • This week has several geometric points which are highlighted in red.
At this point 1173.00 has to be considered a structurally important level. For traders seeking to get short the market-the formation of another nearby pivot would set up an excellent formation to set up a short sale.

IMPORTANT: Check out the Transports--they are making a classic top formation at the 5080 level mentioned last week.

The hourly chart below shows the two minor pivots--1232.85 & 1219.50 that should be monitored. Aggressive traders should use these levels--if broken-- to execute shorts with appropriate stops.


The Gann Square of Nine chart shows that the S&P is near important natural squares
  • On the far left at the Sept 23 Equinox the levels 1041 ( Aug 27th low) and 1174 (November 16th low) are naturally squared. 90 degrees lower is the current date--December 21st--solstice.
  • 90 degrees from the Dec 21st is the Spring Equinox level which has 1243 as a natural square. The market closed slightly above this level. If the rally continues 1243 should become a strategic support level. However, as mentioned above, the 1243-1250 level could provide significant resistance to a continuation of the rally.
  • Note the 1010 near the Summer solstice at the top of the chart. 1010 (July 1st low) is only one away from the natural square.


The chart below is for entertainment purposes only. It is a pentagon--full of Fibonacci goodies--formed from the Mar 06 2009 low. Where the midpoints of the side of the pentagon are formed are coincident with some interesting market dates--pivots. Fibonacci relationships are wondrous gifts from nature.


This may be the last update until after Christmas. If so: Peace to All and Thank You for visiting My Squiggly Lines.

Sunday, December 19, 2010

Solstice-eclipse overlap first in 456 years


Thursday, December 16, 2010

Time to be Vigilant

So far the high has been 1246.73 on Monday the 13th which is in line with the geometric cycle projection. (Dec 10-13)
The following levels should be support levels on any decline that is 'corrective' in nature:
1235.19: Wed's close & Range Harmonic.
1227.08: High November 5th.
1219.80: Range Harmonic & April 26th high
1173.00: November 16th low & Pivot Low.


The behavior of the RSI during this early decline will be important to monitor since it will reflect the nature of the decline--whether it is corrective or impulsive. The next Energy Date is expected between Dec 20-22nd. If the market has enough upside momentum, the decline could terminate and the S&P may make an attempt at the 1250-1255 area before an intermediate term correction begins. (Possibly Jan 4-8)

A break below 1219.80 will suggest that the decline is gaining steam and that a confluence of longer term cycles may be affecting a turn in the market. The metal markets and currencies will give clues about where the S&P is headed. Breaking 1173.00 and a serious decline may have commenced.
Note how the lower tine of the yellow pitchfork intersects the 1219-1220 level during the Dec 20-22nd Energy Window--it currently is acting as support at the 1235 level..


Wednesday, December 15, 2010

Another Brick In The Wall

A few weeks ago I mentioned that the Chicago P/C Equity ratios were not at the type of extremes that one would expect at a significant peak. Last week a chart showed how low TRIN did not necessarily signal a market correction.
However,when both the CPCE and TRIN are at extremes--like now--the probability of an imminent correction is significantly increased.

1219.50 and 1256.00 are important levels to monitor.



Below shows an intersection of two pitchforks...INTERESTING........



Perhaps it can be viewed as 'Another Brick in the Wall'

Thank You Pink Floyd !!!!!

Tuesday, December 14, 2010

S&P 500 1250

The chart below shows the amplitude of the rallies and declines in the S&P since the April 26th high. Virtually are of the corrections were extremely close to natural geometric numbers: 60, 90, 120, 150, 180, 210...

Projecting these harmonic amplitudes up from the various pivots produces two clusters of levels between 1200 and 1300. There are 1220-1225..near the November 5th high and at 1250-1255 level.

The December Cycle Projections suggest that pivots could form between Dec 10-13th and Dec. 20-22nd
A break below 1219.50 will be a distinct warning that a high is being made. The First January Time harmonics will be between Jan 4-8th.

Sunday, December 12, 2010

S&P 500 Geometric Harmonics

The chart of the S&P 500 below shows an interesting relationship between price and harmonic angles.
The Bottom Chart:
  • form a rectangle from the October 2007 high and March 2009 low.
  • From the bottom left corner of the rectangle--October 11 2007 project 30, and 45 degree angles.
  • Draw horizontal lines from the intersection point of these angles and the vertical line representing Mar 9 2009.
  • The 30 degree intersection--when extended forward in time intersects the July 1, 2010 low of 1010.
  • The 45 degree intersection when projected forward is slightly above current levels--between 1250 and 1260. This level may provide resistance to any further ascent in prices. If a horizontal line is projected back in time--to the left--the horizontal intersects the March 21 2008 low @ 1256.98
The Top Chart
  • Extend 30 and 45 degree vectors from the top and bottom horizontals of the rectangle representing the October 2007 high and March 2009 low.
  • Note where the 30 vector from the October high (Green) intersects the 30 degree vector from the March 2009 low. (Orange) You can use either top of the rectangle or bottom corners of the rectangle since they necessarily intersect in the same place.
  • This intersection of vectors takes place at the April 2010 high.
  • If the 45 degree vectors are extended from the same corners interesting pivots are indicated.
  1. The 30 degree vectors (Green) from the October 2007 high intersect the 45 degree vectors (Blue) emanating from the March 2009 low. This occurs in this current time period.
  2. The 30 vectors from the March low--both corners of the rectangle (Orange)--intersect in the current period as well--coincident with the 30-45 intersection mentioned in point 1.
  3. Note also where the 45 degree from the March low interests the 30 degree from the march low. At the July 2010 low!!!!
The period between now and January 8th may form a significant high in the S&P 500.



Friday, December 10, 2010

Transports & U.S. Dollar

Transports:
The behavior of the transports at this harmonic price level will offer a clue as to the direction of the general market in the short term. If the Transports break above 5080 significantly, further rally in the equities can be expected. If 5080 becomes strong resistance a topping process may be in the making.


All seems well with the US $.

  • Diagonal resistance points from the June 7, 2010 high were at the 15 and 30 degree vectors (August high @ 30* and the recent November high @ 15*)
  • 45* vector off the November low has acted as diagonal support at the Dec 3rd low. Dec 3rd--a Friday--was 119 days from the August 6th high.
  • Note the resistance at the recent high is at the extension of the diagonal of the base rectangle formed from the Aug 6th low and the November 4th low. 90 Days
  • Resistance encountered at the 200 day SMA.
  • Energy Date Dec 18-23 should resolve the current price congestion. December 19th is 135 (90+45) days from the August 6th high.

Harmonic Price Levels are:
Geometric PRICE
Degrees 75.63
30 78.56
45 80.04
60 81.54
72 82.75
90 84.58
120 87.67
135 89.24
144 90.18
150 90.82
180 94.02


Wednesday, December 8, 2010

S&P 500

Pivot Points for Dec. 8,2010
R3 1246.85
R2 1239.15
R1 1231.45
PIVOT 1227.35
S1 1219.65
S2 1215.55
S3 1207.85



The possibility of an intermediate top will increase if 1200 is broken in the cash market. A break of 1173 (especially on a closing basis) would complete the formation of the pivot point.
  • The center tine of the Andrew's Pitchfork should act as diagonal resistance on the daily chart. (top)
  • The lower tine will be near 1200 over the next few sessions--diagonal support should be expected.
  • Lower Bollinger Band is at approx. 1173. Since this is the last pivot point as well, strong support should be anticipated.



  • Upper tine of APF held prices back on Tuesday. Selling at the close suggests that the lower BB may be tested which is near 1214-1216.
  • 1200 represents the 50% level of the November decline. Diagonal support from the hourly APF should be expected.

Monday, December 6, 2010

A Sobering Chart.

Several blogs are pointing out the low 5 day Arm's Index (TRIN) on Friday. Low TRINs are supposed to indicate over-bought markets--markets that are ready to pivot downwards--well that is the conventional wisdom.
The chart below indicates that low TRINs over the last 3 years seem to occur during the acceleration stage of several rallies since the March '09 low. Judging by the evidence I would be inclined to be cautious when using TRIN.


This is interesting since a comparison to the "TRINs" of the 1990s and early 2Ks to the behavior of market breadth today suggests that the market--for whatever reason--is a different beast. Is it because of the power being exerted by hedge funds??--the omnipresence of ETFs???, black pools, the Fed.....ad nauseam. The finger of immediate blame may be pointed in many directions--but one thing is certain--the general public are becoming farther and farther removed from the 'market place'. At one point--when America was 'humming' individuals owned shares of Ford, GE X KO EK....the middle class participated in the economy--reaped the benefits and invested in the country on a personal basis. Today the middle class--the remaining few that can afford to invest in equities-- have their wealth managed by institutions that package product which consequently does not necessitate an individuals direct attention to the industrial economy.
As the middle class struggle in a world where money is being polarized at the fastest rate in America's history, their jobs are disappearing while at the same time their wealth is being invested in a world that becomes increasingly obscure and removed from the devastation of the foundations of our way of life.

The markets have changed--for the benefit of the common good??? That would be a tough argument to make.

Extremely low TRIN values are indicated by the green columns.

Sunday, December 5, 2010

Transports

There are some interesting things about the chart of the Transports below:
When the Range from the May 19, 2008 -Mar 9 2009 is 'squared' harmonic angles become active.
  • using the range amplitude (ht.) as the hypotenuse of a equilateral triangle, the height of the perpendicular is .866 = sin(60) The translates into a value of 5080.65 for the Dow Transports.
  • Note the significance of the various 30, 45 and 60 degree rays coming from the low, high and 'squares'.
  • The second cycle is coming to an end and current prices are at a harmonic level.
A high in this vicinity (5000-5100 2%) followed by a reversal pattern would be an early warning of further deterioration in the broader markets.

The following levels should act as support and resistance. Breaking the lower support level would raise the probabilities that a significant top has been completed

  • R2: 5243
  • R1: 5156
  • Pivot: 4988.74
  • S1: 4901.31
  • S2: 4733.80


.

Thursday, December 2, 2010

Wednesday, December 1, 2010

Two Numbers:

SPX 500 Close less than 1170.71 and VIX close greater than 24.52

suggests turbulent waters ahead.



US Dollar

Tuesday, November 30, 2010

December 2010

The graphs below indicate dates where markets may be 'energized'. Watch for highs, lows and/or volatility.
Support Resistance for November 30- Dec 3rd.
Support
  • 1178.19
  • 1171.71
  • 1166.99
  • 1151.00
  • 1080.00
Archimedes Point: 1188

Resistance

  • 1199.32
  • 1209.25
  • 1221.00
  • 1231.00
  • 1250.00

Energy Dates for December 2010

  • Dec 3-4 **
  • Dec 10-14*****
  • Dec 18-22*****
  • Dec 27-28



Wednesday, November 24, 2010

Municipal Bonds Could be a PROBLEM

U.S. Dollar
The USDX broke above the previous pivot and is remaining to be contained within the parallelepiped shown on November 12th.
There is a harmonic time cluster the week of Dec 13-17th. If the USDX can break above the resistance indicated on the chart a strong move into mid-December is quite likely.

S&P
The S&P is just above a critical pivot @ 1173.00. The next pivot support is @ 1159.71. While a continuation of the August 27th rally to the 1250 projection is still possible the market should hold above the 1173.00 level--definitely the 1159.71 pivot. There is a time harmonic cluster for the S&P between Dec 18 and Dec 22.

The hideous looking Municipal Bond ETF bears close scrutiny over the next few weeks. Are 'munis' the next shoe to drop?

The cluster of time harmonics for the various markets--gold-US$--S&P suggests that the week before Christmas may have some surprises in store for the financial world.


Tuesday, November 23, 2010

Gold and Fibonacci

Below is an astute observation made by subscriber 'Ricardo'. The time period of Dec 16-22nd looks like some 'PHI energy' may affect the Gold Market. Another date to put in your trading journal. Thx. Ricardo!

Monday, November 22, 2010

iShares 20+ Treasury Bond ETF (TLT)

Here is a fascinating chart that suggests that the last week of December 2010 or opening week of 2011 may be interesting for Bond Traders:

The top chart is a 'Square of Range Chart. Note that the squares are not actually geometric squares but 'square' the range of 13 weeks with the 13 point range of the June 10, 2009 and October 2nd 2009 rally.
  • The rally lasted from June 10 to October 2 of 2009. (114 days) The range of the rally was 13 points (96.05-83.05)
  • When 13 points is converted into time--13 weeks = 91 days. 91 days is 1/4 of a year and one day off the harmonic 90 degree geometric. The upper chart is then constructed using 13 week x 13 point 'squares.
  • The 5th 13 week cycle is due Dec 31 2010
  • The lower chart uses the conventional 114 day cycle. The synodic period of the two cycles--91 day and 114 day is 451 days. October 2 2009 + 451 days = December 27th 2010.
  • 5 cycles of 114 days = 570 days. June 10, 2009 + 570 days = January 1 2011.
  • There are several geometric projections from pivot points in TLT over the last year. They culminate between December 23rd and January 6th.
  • Using trigonometric price projections the .886 level (sine(60)) and the .7071 (sine(45)) are very near areas of support and resistance since the June 10, 2009 commencement of the cycle being analyzed. Note the circles where pivots--support and resistance-- occurred.






Although it is anyone's guess as to what the last week of December and first week of January 2011 will bring--the analysis of these cycles suggest that this time period should be earmarked for special attention by Debt Traders.

Wednesday, November 17, 2010

S&P Roadmap

Below is a '3D' projection of the S&P 500

Price Considerations
  • The 'originated rectangle' is the formed from the July 1 - Aug 9th rally and is the basis for the parallelepiped rectangular solid. Points A and B.
  • Equal structures are created that are marked 1, 2 & 3 and projected 'back' two units--or--price cycles.
  • Note that the second price cycle intersects the recent 1227.08 high at the 2.5 time cycle point. Projected point was November 14th--actual high is November 5th. Point D
  • Since November 5th prices have declined 'one price cycle' and found support Tuesday at the 1175-1180 level--which was a congestion area in mid-October.
  • The next linear support level will be at the 1129-1130 level which marked the highs of June 21 and August 9th. There is also linear support at 1115-1117 which is 1/2 the first price cycle amplitude.
  • Critical Support is at the 1055-1060 level which is the 'base' of the first price cycle structure. The support at the 2nd price cycle is the familiar 1105-1107 which has been referred to numerous times over the last several months.
  • Note the diagonal lines--sides of the parallelepiped-- have and should provide price support. Will the market recover and follow the green line back up like it followed the 'outside edge' of the second rectangle cycle?
  • Below 1105: ALL HELL WILL BREAK LOOSE.
Time Considerations

  • The time aspect originates from the July 1st low and August 9th low Points A and B--same as the price.
  • The first time cycle is 39 days. Each rectangular structure to the right is also 39 days.
  • The markets makes the secondary low on Aug. 27th which is at the half way point between rectangle 1 and rectangle 2. (or 180 degrees of the price cycle.)
  • Note that the recent November 5th high is at the 1/2 point between rectangle 1 and 2 but at the back of the structure-- which is equal to the 3.50 cycle length. The low of August 27th is at the parallel of the November 5th high.Points C and D
Future Dates of Interest

  • Dec 1-5 Back lower corner of 1st Price cycle 1 which is the same as Rectangle 4 (not shown)
  • January 7-10: lower corner of 2nd price cycle which is the same as rectangle 5 (not shown)
  • February 1: Aug 9 - November 5 = 88 days. November 5 + 88 days = February 1
  • March 12: July 1 -November 5th = 127 days. November 5th 9+ 127 days = March 12th.


Monday, November 15, 2010

Saturday, November 13, 2010

S&P Top?

The charts below make a case for a top being made at last week's November 8th Energy Date. While it is still possible for the market to rally into the November 22-25th Energy period, technical indicators are suggesting that a decline is imminent.

This chart shows the square of time using the April 26 - July 1 decline.
  • 2 cycles from July 1 is NOVEMBER 10th.
  • 90 days from Aug 9 is November 7th
  • 720 degrees DOWN from 1219.80 (price) intersected the 1010 low with time.(April 26-July 1)
  • Technical studies appear to be breaking down after showing divergence.

The charts below show the S&P using a 3D projection of 4 key pivots:
Upper Chart
  • AB form the upper parallelepiped. (February 5th - July 1st major lows).
  • Prices hugged the lower corner of the structure during the ascent in September and October.
  • Prices have entered the top right corner of the structure with resistance being encountered at the bottom of the back side of the parallelepiped.
  • An advance into the November 22-25 time frame would put prices at the upper right side of the structure--the extreme point.
  • Prices have followed the 60 degree vector off the August 27th low of 1039.70.
Lower Chart
  • The lower parallelepiped was formed from the June 21st high and the Aug 27th Low.
  • The structure terminated with price approaching the extreme upper right corner--Exact time--price 3 pts. off.
  • Prices hugged the 50% height of the side of the parallelepiped through September and October and spiked to the upper corner in November before reversing.
  • Fridays close was at the 50% height level of the 'side' of the structure.

Friday, November 12, 2010

US $ in 3D

The direction of the USDX will determine the direction of virtually every other market--such as Gold, Silver, Copper, SPX as well as a host of other commodities--such as Sugar, Cotton etc.
The chart below is a "3D" depiction of the USDX.
  • Note how the rectangle derived from points 'AB' form the basis of the parallelpiped. Points A and B are the highs of June and August. The base is denoted as dark blue with the facing side light blue. The back of the rectangular solid is the partially hidden yellow face.
  • Note how prices hugged the 'corners' of the parallelpiped.
  • Prices are still hugging the downtrend line which suggests that the anticipated change in trend of the US $ is not confirmed. A break above 78.36 CASH will be construed as being VERY BULLISH and confirm a change of trend.
  • The lower parallelpiped is derived from points CD which are the lows of August and November.
  • Prices may follow the side panel of the rectangular prism as did prices on the descent into the latest low.


CLICK TO ENLARGE

Wednesday, November 10, 2010

Interesting Times are Approaching

Traders that take a contrary position often end up on the profitable side of a trade. The U.S. $ may prove to be a textbook case. When Ben Ponzi announced that he and his financial alchemists were going to manipulate the markets last week the US $ had every reason in the world to tank--it didn't--instead it appears to have made a low.
Cycles suggested that a low was pending on the charts posted over the last several days. (I have included the October 27th chart showing the time price cycle that caught the momentum low) The chart immediately below shows the bullish divergences that have formed with the QE II spike.

A close above 78.36 (cash) would be considered EXTREMELY BULLISH.



Silver certainly likes to be a drama queen. Margins were raised on the futures contract today which prompted a reversal. I cannot help remember good Old Bunker Hunt in 1980 when he and his brother attempted to corner the market. Silver was trading at over $50.00 an ounce only to crash back to reality.
Silver bears close monitoring as it could possibly be the mirror image of the USDX. If the market does not repair the hideous weekly candlestick forming a significant reversal may be at hand.



The S&P is at a critical area. Fibonacci levels are once again being tested while the weekly charts venture into overbought territory. While a move to the 1250 level is quite possible coincident with the November 20-25 geometric projections for a trend change, the S&P could reverse at this level since November 8th represented a relatively powerful ENERGY DATE.
A close below 1193 Cash would likely confirm a reversal in trend.
A major reversal would be confirmed if the Cash traded below 1171.70 and the Dec contract traded below 1167.80

Note that 30 degrees up from the low has been support. Could 15 degrees from the high be the ultimate resistance?


Tuesday, November 9, 2010

Reversal Date?

The markets are just leaving the influence of the November 8th Energy Date. There could be major reversals taking place today. There will be a detailed update this evening.

Friday, November 5, 2010

SPX 1250 ?


I believe that banking institutions are more dangerous to
our liberties than standing armies.
If the American people ever allow
private banks to control the issue of their
currency, first by inflation, then by
deflation, the banks and corporations that will
grow up around the banks will deprive the people
of all property - until their children
wake-up homeless on the continent their fathers
conquered.
Thomas Jefferson
1802


Several months ago the inverted H&S was mentioned--stating that 'the street' was obsessed with the regular H&S but did not seem to see the potential inverted H&S.
The break above 1130 validated the Inverted H&S formation which projects a move to the 1250 area.

The graph below shows the geometric nature of the market swings since the April 26th high. The swings all approximated a multiple of 360.
If these geometric patterns continue it follows that the advance off the 1039.70 low on August 27th may measure somewhere near a geometric number. ( 90, 120, 150, 180, 210, 225, 240, 270, 300, 360....)
If the S&P is at the 1250 level on or near November 24th it would represent a harmonic vibration of price and time.


U.S. Dollar.

Three November Energy clusters:
Nov. 2-4
Nov 10-12
Nov. 20-24

Momentum divergences will form as cycle low nears.
Monitor 3 day pivots and hourly charts.

Is a dive into the 20th-25th possible?



Thursday, November 4, 2010

Update this evening.

"The most important change in my trading career occurred when I learned to divorce my ego from the trade. Trading is a psychological game. Most people think that they’re playing against the market, but the market doesn’t care. You’re really playing against yourself. You have to stop trying to will things to happen in order to prove that you’re right"
Marty Schwartz

Monday, November 1, 2010

From Square to Triangle: Price Time Harmonics

The charts below project some interesting things about last week and the week of November 22nd for the market. The projections are made by taking a swing range and projecting that range forward in time. Since the peak on April 26, 2010 the market has been making swings of a very geometric nature as the table below indicate. (the advances and decline range approximated the geometric 90-120-180-210 numbers). Projecting these price ranges forward indicates that last week's market action--peaking at 1196.14--may be a significant resistance level that will impede any further advance. The third week of November produces similar time clusters that suggest that a cycle change may occur then as well.
Another interesting exercise is if the range is multiplied by either 1.732 or .8666 important price levels-historically and possibly in the future are generated. By converting the square of a price range into an equilateral triangle remarkable relationships reveal themselves.
  • When a 2x2 square is converted into a equilateral triangle (2x2x2) it is shown that when the triangle is divided into 2 right angle triangles the perpendicular (opposite side) is necessarily 1.732 or the square root of 3.
  • The resulting height of the perpendicular relative to the hypotenuse is a ratio of 1.732:2 or .86666.
  • Multiplying the range by .8666 significant levels are generated--showing levels of supply and resistance.
  • As well as projecting price forward the center of the triangle--at the perpendicular--trend changes often occur. The relationship of the various swings during the summer are seen to be all related geometrically. Other relationships become evident by applying 90-120-180... degrees to the range. Try it--you will see many minor trend changes hit.




The table below shows these relationships. (right click to open in a separate window or tab)

These two graph are essentially present the same information but one may be easier to follow than the other. :)



It is quite possible that the market is in an area of some significant 'energy'--both in regard to price and time. It appears that once the this coming week passes the next energized period will be the week of November 22-26th. It would be exceptionally amazing if the market experienced a sharp decline currently and then rallied once again to present levels or slightly higher in the latter part of November.

Saturday, October 30, 2010

November 2010

When did the market bottom?
The conventional date is March 6, 2009 @ 666.79. However November 21, 2007 was the previous low swing. November was the date that the Chicago P/C Equity ratios peaked. (10-98, 21e-.92,50- 0.85). The low of 741.02 on November 21st was the swing point that various technical divergences were based upon and the last cycle low preceding the market reversal. November 21, 2008 to March 6, 2009 is 105 days or 15 weeks.
  • The initial square spans the 105 days between the lows--from November 21st a matrix of squares are generated.
  • The subsequent action in the market appears to be guided by the 1x1, 2x1, 3x1 & 4x1 arrays originating from November 21st. The markets oscillated around the fan lines defining both rate of increase and the price levels of important support and resistance.
  • The cycles traveled between 2x1 and 3x1 until the April 26, 2009 high.
  • Since the bottoms of July 1st and August 27th the market has been contained between the 3x1 and 4x1 lines.
  • The vertical cycle lines are near significant pivots being formed during the advance. (4 highs 1 Low)
The most intriguing aspect of this chart is that the market is approaching the termination of the 7th cycle. The purple circle indicates the 7th cycle sphere of influence. Like the currency chart posted earlier the number 7 has been dominant in the factoring of the cycles. 7 x 15 = 105
  • The cycle termination date is November 26th
  • The support arc is approaching the horizontal axis of the 7th square.
The behavior of the market during the previous 6 cycles suggests that the ending of the 7th cycle may usher in an acceleration of trend--or perhaps--an termination of the influence of the 2008-2009 low.
The market may be a raging bull about to burst to the upside--or--as my pal J.A. Wow says: "A bug looking for a windshield."

As November progresses traders should be on the lookout for other cycle dates that may have increasing influence on the action in the markets. The strength of the fan lines will be an excellent tool to determine if the market is changing 'frequency'.

The chart can be opened in a separate window by clicking the image.


The calendar below is used to estimate when 'energy' may influence market behavior. It is composed of 3 types of cyclical data:
  • Golden Ratio Harmonics
  • Geometric Harmonics
  • Planetary Harmonics
November's calendar suggests that Monday mornings will interesting as far as volatility is concerned. November 8th, 15th, 18-22nd & November 29-30th are the highest 'energized' dates.

The calendar can be opened in a separate window by clicking the image.

Thursday, October 28, 2010

European Geometry

The last comment demonstrated the 7 week or 49 day (7x7) cycle in the USDX. The following is a graph of the EURO with a 84 day or 12 week cycle. 7 X 12 = 84

The graph is divided into grids based upon the initial 84 day cycle from the April 22, 2008 high of 160.20 and the subsequent high of 160.19 on July 15, 2008. This initial cycle is the highlighted yellow square in the top left corner.
  • Squaring out 7 cycles hits the projected Dec 01 2009 high: actual high is November 25, 2009. Note that time is 7 squares over and price is one square down. (Burgundy Square)
  • Prices broke down when the EURO broke under the 30 degree vector emanating from the center of the 7 square circle (The red circle at 3.5 x 3.5)
  • Extending the initial double top square 12 cycles projects a potential pivot on November 2, 2009 (# 11) and January 25, 2011 (#12)
  • The arc of the 12 cycle square (Green Square) is currently acting as resistance to the EURO
  • The 30 degree vector coming from the center of the 12 square cycle is just below current the current price level much like the 30 degree vector acted with the 7 square cycle. The 30 degree vector will be at approximately 140 at the termination of the 12 square cycle on January 25th.
  • Note how many times the price of the Euro hit the grid intersections during the 7 and 12 square cycle. The vertical grid lines offered support and resistance and the vertical grids were at or near pivot points. The Euro is currently at (GRID 11-3) Previous hits were at 2-2, 3-2, 4-3, 6-2, 7-1, 8-3, and 10-3.
BOTH THE EURO AND USDX ARE AT IMPORTANT CYCLE JUNCTURES. THE PRICE ACTION IN THE NEXT WEEK WILL LIKELY DETERMINE THE TREND INTO LATE JANUARY OF 2011.

Lucky Sevens for the US $

The U.S. Dollar Index is shown below.
The low following the pivotal November 25 2009 low occurred on Jan 13 2010--a period of 49 calendar days.
If a 49 day square is projected from the November 25 low and interesting phenomena occurs in this time period.

  • The initial period is 49 which is equal to seven weeks: 7 X 7
  • If the initial square is projected out by seven cycles 49 cycle squares make up the larger orange square.
  • The seventh square marks both the time and price of the recent low.
  • A move above the recent high of 78.36 would be a bullish development for the $.




The chart below shows the 45 degree and 30 degree radii coming from the center of the square made up of the 7 smaller squares shown above. Note how the 30* lines has acted as support and resistance during the period of the 7X7 cycle.

Tuesday, October 26, 2010

An Interesting Week Ahead.

The chart below depicts a 57 day cycle time-price square. The market is in a position to move away from this price level in a volatile manner. Watch VIX.