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.

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