While there has been a lot of talk of a stock market crash, the resumption of the elusive wave C, and the collapse of the Euro. There has been nearly no mention of the most popular time cycle that comes along every four years about this time: the 4-year presidential cycle. We last wrote about this cycle when it was about to bottom in July 2006. In the midst of the last bull market. Now we’re writing about it again. Below is that post:
the four year cycle
Since this is 2006 there has been lots of talk about the four year presidential cycle. This is a recurring cycle, noted throughout the years, to create important bottoms in the stock market. And, it has been somewhat reliable with a few exceptions. If it is occurring again this year, the question would arise; “Which is the most likely month?” I took a look at the historical lows of this cycle using 1934 as a starting point. The reason I chose 1934, is because that year marked the end of Primary wave IV of the first cycle wave up from the 1929 – 1932 bear market. In the prior 18 occurrences: 1934 – 2002; eight occurred in the first half of the year, and ten the second half. The months of Feb, Apr, July, Aug and Oct had multiple events; two each in every month except Oct which had four. Based on monthly frequency October would appear to be the most likely month for a low. When using a bell curve, July would appear the most likely month. Naturally, I prefer July.
Now that there have been 19 occurrences and only July (3) and Oct (4) have more than two hits in the past nearly 80 years. Below is a chart covering the past 30 years. Notice the 4-year cycle low occurs at the end of bear markets and in the middle of bull markets. Not at the beginning or continuation of bear markets. If it is going to put in a bottom to the elusive wave C it only has until the end of the year to do so. We expect, however, when the bottom does come in either June or July it will have ended Primary wave II possibly, after a 50% retracement, at the OEW 944 pivot. Then the bull market will resume.
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DOW JONES INVERTED HEAD AND SHOULDERS PATTERN IN DAILY CHARThttp://niftychartsandpatterns.blogspot.com/2010/05/dow-jones-inverted-head-and-shoulders.htmlThank you
MACDaddy-thanks for your comment . Nice pink! The world needs more pink…lol!
Hi Robert,The 4-year cycle low has occurred every 4 years since 1934.Will post a chart some time.
Amazing those EW pivots!
Hi Greg,That\’s certainly possible.Have seen the 4-year create an ABC that large before.
I have read elsewhere that we did not have a 4-year cycle low in 2006 and in fact the 4-year cycle extended to the longest 4-year cycle in history and it can be argued that the 4-year cycle bottomed in January 2008. We then had a left-translated up cycle that ended in May 2008 at the top of wave 2 of Primary wave 1 or A down. We likely won\’t see a 4-year cycle low this year. The next 4-year cycle low should be below the March 2009 lows.
OK, you two ..it\’s been your pleasure to entertain us today…..lol…
CB, no prob, Dos, we are!
Real nice JakeThought we were all friends here….
Nice…when you "re-instate" I\’d like to be among the first ones to know…lol..
Honestly, one half, looking to reinstate tomorrow or Thurs.
well Jake if you bought to cover your shorts…that was pretty smart..
"These aren\’t the droids you\’re looking for""Move along".:)
Jake d\’Rakewrote:Any heroes buying the opening? First stop 1045 on the SP\’s8 hours ago Tell us the truth Jake That was a Jedi mind trick wasn\’t it?You bought it ….
The 60 minute MACD has turned positive and has divergences on all lows.
Well it official that\’sTHE low today.The tiny man on CNBC told me
just closed gap from this mornings drop
Nearing 1.618 and potential terminal pattern.
Does anyone think we need to retest morning lows and set up some positive d on 15 min. chart?
Dos, Lol……I am thinking possibly at this TL would be an interesting entry , also fibwise http://screencast.com/t/YmM2ODQ5 but I would prefer to wait post-Bernanke.
CBWhat I really meant to say is I hate everybody who did .Ive seen folks post buys below printed prices ..a touch and go has to be a lay up for them
we barely touched that 1041 pivot …we\’ll be back testing it again at some point..15 min MACD didn\’t look so hot at today\’s low http://screencast.com/t/OGYwZjMxOTU
Congrats to those who bought the 1040 pivot this am..
struggling at pivot
SPX stayed within the 1030-1056 EW/Fib targets which it first touched last week. Daily RSI5 finally shows posd with stoch trying to cross up and 60min posd growing. The numbers I outlined on Sunday drop down a bit. If SPX is forming a wave 2 retrace of 1174, a 23-38-50% Fib retrace would currently be 1072-1092-1107. If SPX is forming a wave 2 retrace of 1220, a 38-62% Fib retrace would currently be 1109-1152. So, it appears OEW\’s 1107 pivot could be a good marker between bear counts and 1085-1095 could be problematic once again in the more rapid bearish count. 1086 remains hourly resistance in my system. I see a potential LDT for 1041–>1060 which could be an A wave with C=A currently at 1070 matching a 23% retrace of 1174. Still, my system remains on an active sell signal with recommended profit taking at 1044-1056. The opening and closing hour has been wild lately. Be back tonight. Good luck.
thanks AB..15 min still not good enough though.
well, 13:40 passed, nothing happened there. the tolerance margin is +- 10m.either i made mistakes on calculating the time, or that time is not significant, hence need pass to the next time cluster. not easy to calculate time. will review & learn from mistakes.
C B: Yes there is – though that could get cleaned up.
jim,no, it\’s ET.looks i made mistake somewhere. will review, learn from mistakes.
for anyone watching 60 min macd -do you guys see a (+) D or not….diffrent charts are telling me different things. thanks
HS, Maybe it was Mountain time.
Hello Tony,If your count from the March 2009 low is correct, then we had a 13+ month primary wave (P1) rally that topped out in April of this year. If the current move down is part of the correction of that rally (P2), why would we expect the correction to end in only a few weeks? Seems to me it would take much longer than a few weeks to correct a 13 month rally.How about this: The current move down is only wave A of P2. When it bottoms in the next day or couple of weeks, we get a rally, and that rally will be wave B of P2. After wave B tops in June or July or August, we get another big move down to test or exceed the wave A low. That will be wave C of P2. Could bottom in October, eh? Then up from there.The correction started in late April, if we bottom in October, then P2 would be 6 months long. A 6 month correction for a 13 month advance seems about right IMO. Or maybe it happens faster than that, but I believe it\’s likely the current move down is only wave A of P2, with waves B and C to follow. Maybe C bottoms in July or August, but I think it\’s unlikely that C of P2 is bottoming now or in the next week or two.
20 min to my predicted time of 13:40.hd, last week, i also posted:<< Fractals of "Elliott Wave Relativity With Expanding Technique" a brief write up.everything in the world, including elliott wave, are not absolute, they are all relative. It\’s einstein\’s theory of relativity.when people say spx down from 1576 to 666, it\’s impulsive, motive waves. & the other way is corective. But in relativity, it\’s a corection against the bottom of the bottom from 100 years ago. And some see from 666 to 1220 as 5 waves impulsive up, but in relativity, it\’s a correction against the move from 1576 to 666. Even the move from 100 years ago to 1576 still a correction, a correction against the infinite of the universe\’s unlimited scale.It\’s all reativity! Elliott waves rules are still good, but need to do it in a relativity fashion. Try this concept & back test for as far as you want, lots picture will be more clear & not so be forced.Second thing i like to say is the expanding technique.i know ewp & most convetional wisdom are looking for parallel lines, channels. But actually they are all in either Expanding or Reverse Expanding fashion. people are trying to find channels for the long term chart from 100 years ago, but it never exist.The expanding concept can also apply to the world for everything. Even the universe is in either an expanding or reverse expanding fashion. When it gets to one extreme of (reverse) expanding, it goes the other way. Even in our daily life, everything is in expanding or reverse expanding. Everything either "meet" (reverse expanding), or apart (expanding), hardly in parallel. It\’s my finding that applying this technique or concept to chart patterns or elliott wave, it would work much better.Good luck!!! >>
Cool, Lots of ways to skin a cat. Only price pays though. I use pretty strict rules for impulse waves. No chop or overlap and one wave must extend yada yada yadaPivots getting rocked!
hd, i posted following on my blog last friday:now a concept of elliott wave.what\’s eliott wave?imho, it\’s a way mr. eliott interpret the "pattern" of market behavior.a pattern can be interpreted by many different ways, elliott wave is one of them.now come to the big argument.some call the down waves from 1576 to 666 as 1-2-3-4-5 (mr. prechter falls into this catergory), some call it A-B-C (mr. neely & mchughs in this group).for the waves up from 666 to 1220, some call it 1-2-3-4-5, others call it W-X-Y-X-Z.some call the down waves from 1576 as impulsive, some say it\’s A-B-C corrective.some call the up wave from 666 as 1-2-3-4-5 impulsive. some say it\’s corrective W-X-Y-X-Z.but what\’s the definition of impulsive and corrective? by your own eyes or there is a strict rule?solving this problem, we probably have a better picture of the market.time, time, time. time is the most important element of every function in the universe.in the universe, time can be as slow as millions of years to infinite. or time can be as fast as light speed. what is slow, what is fast? slow as millions of years, but fast as light speed can not touch the other end of the time, or if the other end is a rounding infinite.it\’s all relative. it can be relatively small, or it can be relatively large. small is large, large is small. exist is non-exist, non-exist is exist.now, what\’s impulsive, what\’s corrective?you say the down is impulsive, but he says corrective. you say the up is corrective, he says impulsive.imho, it\’s all relative.from spx 1576 down to 666 is corrective if relative to from 0 to 1576.from 666 up to 1220 also is corrective if relative to the previous down wave.even from 0 to 1576 also is corrective if relative to infinity of the power of the universe.it\’s all relative.if the power of this wave is less than the power of previous wave, then it\’s corrective. but considering nothing has more power than the infinite power of the universe, then all waves should be corrective.so, the author propose elliott wave with relativity.and found out labeling all elliott waves with corrective waves has more satisfactory results.
my original calculated & posted time of low of today should be 13:40, let\’s see anything happen there. one more hour.
as far as i know, 21st day already passed yesterday. nothing there, no significance.i see june 9 as the low of well below 1000, then a slow steady come back to probably 1070\’s around mid jul(need verification).
I knew I liked your style. That\’s close to what I do. I skip time. Patterns dominate, counts confirm, fibs targets. Welcome to the club! I\’ve never read pretcher or neely. Isn\’t today a fib date for time though?
HD,i don\’t go by prechter\’s way of ew counting any more, imho, too many flaws.i mainly use patterns & time.imho, everything is a subset of patterns, ew included.
C=1.618 A at gap.
Humble student has earned the coveted…….http://www.youtube.com/watch?v=q4u9uWZ-OoANice work. Do you have a count on CL?
"humblestudent said… last friday i predicted on my blog & posted here:<<Prediction:Tuesday May 25 spx @1040.5 >>and last friday i further predicted:<<"after reaching 1040.5 (if), i further predict, it follow with a huge rally, one day(1.5) wonder type, get to 1091 by the end of May 26.i don\’t know what would be the news or event to support this monster huge one day rally.>>but that\’s not the low, should go well below 1000 into june. not suggesting to catch the falling knife.
LOL
imikewrote: Is he staying in a red roof inn?Or just some empty home the feds siting on?22 minutes Just once, let it be a Holiday Inn Express.
Is he staying in a red roof inn?Or just some empty home the feds siting on?
Bernanke\’s speech is later tonight. gl.
$vix didn\’t make a new high today ..so far..
I bought some DVN and JPM this morning.
System: Active sell signal since 1124. Signal re-confirmed at 1082 Monday after another failed run at 1095.10. Some profit-taking is warranted at 1045-1056. Hourly resistance will be 1086 (and falling) if the 1056 low is broken at the open as futures suggest.Opinion: My preferred EW count that 1056 was a swing bottom was wrong since it required 1095.10 to be reached for confirmation and 1070 to hold. My alternate bearish counts suggest a final wave 5 is completing from either 1174 or 1220 with w5=w1 at 1031 and 1052 respectively. If so, a wave 2 bounce retesting 1080-1090 should occur soon, but until my system exits sell mode, it is wise to continue to look for good short entries. Good luck.
Not buying any spx, but I have just sold some bonds (inverse correlation). To be precise, I have sold some german bund @12909&12949
Any heroes buying the opening? First stop 1045 on the SP\’s
Are you ready for start of new swing trade down in gold. Anything below 1185 in Aug gold with $12 stop above. It should hit today during the day or tomorrow night.
http://www.alternet.org/economy/146674/10_ways_the_american_economy_is_built_on_fraud?page=entireA lot of fraud in the system.
…. Then the Bull maket will start …..!