Since the real start date of the rally (after it cleared the resistance of 06/21), the strength of the move up was breathtaking, and bothersome to me (in the absence of the volume of big buyers). Since July 5 (it has been 3 days) and today gap above the 5/31 or 6/01 high, forced me to go back and check on my notes of the dominant time cycles for the stock market. The underlying strength of price move (though not obvious from technical indicators, like volumes or sentiments) was trying to bring my attention to check up on longer term time cycles, as smaller time cycles are superseded by the strength of longer time cycles. Which can only be learned by (re-)viewing the history. History and time cycle generated by the previous history creates the current behavior of the financial markets.
Prudent traders ought to always re-evaluate their positions and stances, if a situation calls for it.
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| Stock Market time cycle analyses and forecast 7-7-11 |
If the market continues to trend higher after 07/08 (which it will, deducted after my re-study of longer term time cycles earlier today), and "around" the 07/08 time cycle, if markets only consolidate and or retrace only a little, then my today's review of history, tells me that time cycles have "reset" the count of the bull market. The time cycles have done, what they do best, change the trend. That means, June 16h low was real trigger for this change of trend. If I am correct in the assumption then bear market 'serious leg down' has been averted for now (recent correction was merely a correction to set the stage for new run up in prices), and new bull market has started as of the retest of the swing lows on 06/23.
Future Outlook: Markets shall find some considerable resistance on 07/18, followed by time cycles of 8/04, 08/22 (8/30). Markets, however, shall continue to trend higher until 09/12-13, followed by a double top (lower or similar height) in first week of October and then the Sever correction extended over 8-9 months (which I was waiting to transpire now), and followed by another leg up into early 2013.









