Current projection:
Cycle low on or about October 18. EDIT 10/7 - Now October 20.
We have gaps to fill on the S&P cash at 1109.55 and 1090.10 which roughly correspond with 38% and 62% Fib retracements of the latest move. These are the price targets on which I am focusing.
We'll see what we get after mid-October, but the longer range forecast shows ~November 12, 2010 as the end of a 3.5 year bear-bull cycle that includes the bull run from March 2009 to the present.
In other words, after mid-November, we should start another long term bear-bull cycle, the first ~18-36 months of which should be a bear market in stocks. For more information, see Terry Laundry's free website called T Theory Observations.
Cycle low on or about October 18. EDIT 10/7 - Now October 20.
We have gaps to fill on the S&P cash at 1109.55 and 1090.10 which roughly correspond with 38% and 62% Fib retracements of the latest move. These are the price targets on which I am focusing.
We'll see what we get after mid-October, but the longer range forecast shows ~November 12, 2010 as the end of a 3.5 year bear-bull cycle that includes the bull run from March 2009 to the present.
In other words, after mid-November, we should start another long term bear-bull cycle, the first ~18-36 months of which should be a bear market in stocks. For more information, see Terry Laundry's free website called T Theory Observations.
Too early to tell yet, but between mid-October and mid-November 2010 we could conceivably see one final push higher on the S&P, perhaps back to the 1150-1220 range.
![[Most Recent Quotes from www.kitco.com]](http://www.kitconet.com/images/live/s_gold.gif)
![[Most Recent USD from www.kitco.com]](http://www.weblinks247.com/indexes/idx24_usd_en_2.gif)
Posts
Just found your site through Terry Landry. Your link to the public chart list does not work. If your charts are available to view would love to see them. Thanks for the hard work. I watched Terry positively comment on you and look forward to following your thinking
ReplyDeleteI have also located your site through Terry Landrey.. I have been a follower of the old Magic T since the early eighties. I think your work is really helping Terry update, and complete his Theory.
ReplyDeleteNow If I could just figure out where the top is in this confounded rally from Sept 1, I would be a happy camper. Your cycle system, using either the April top and July bottom, or the August top/Sept 1 bottom, generates dates that have already passed. Hopefully, the swing top was put in place on 10/4.
Actually, my system generated a Sell signal on MOnday... and this is first sell that I have missed since January.
We need a chat room to discuss Terry, I calculate out the ADO and Vol daily at my site http://tradingnymphtradingdiary.com/
ReplyDeleteGreat stuff, Parker. Found you through Terry as well.
ReplyDeletegreetings from Marthas Vineyard. Found you through Terry who I've followed since late 2008. One thing I want to share with you, I subscribed to Tim Woods cycles news and views because he accurately predicted the 2000 top in the markets and the magnitude of the 2002 low based on cycles theory in writing in a technical journal. At the March low in 09 at 666 SPX he called it a 4 year cycle and seasonal cycle low. October 2010 marks the 19 month since that low. Since 1896, Tim's research says 100% of 4 year cycles that have advanced for 20 months or less (the November top you and Terry are predicting would be the 20th month) did in fact move below the previous 4 year cycle low (ie.. 666). This stat has a 100% track record. We'll know in a few months whether this bearish stat is indeed playing out. An advance for more than 20 months and 18 out of 20 four year cycles held above their previous four year cycle lows.
ReplyDeleteBest,
Steve
Thanks for your comments everyone, and welcome.
ReplyDeleteb - I'll work on the Stockcharts list. Thanks for the heads up.
BillH - I project the top of the rally that began September 1 will be around November 12, with a correction expected along the way culminating in the middle of October. The Nov 12 date is based on long term T13 using a start date of split-divergence in latter June 2007 and the March 6, 2009 low as the center post. The Nov 12 date is confirmed by using split divergence from the late April major top to the split divergence at the early August minor top. I will either do a post or a video about this.
TradingNymph - looking forward to checking out your site.
SteveC - thanks for the research. Did not know that.
Many thanks,
Parker
My first visit to your site. If I recall correctly from early T-Theory postings, it is not recommended that one use the second (in this case, March 6 2009) low of a split bottom as the center post; you can either use the first low for a conservative T or a split of the two for a late T. Have you looked at a bunch of historical T's and found it to be safe after all?
ReplyDeleteHi Robb
ReplyDeleteYou are correct - Terry does say that. The concept is called a nulled echo. And I agree with him. Let me explain:
My data set is Stockcharts, and they have AD Line back to 1991. So I have studied Long Range Advance Decline T8 - T13.
T8-T10 present no double bottom issues. T11 is a relatively short T (12.5 months total between 1998-99) that could be interpreted as a double bottom. I'm not sure, but as far as I can tell Terry put the center post in the 2nd bottom (early October 1998) vs. the split bottom (mid-September 1998).
T12 squarely presents the split bottom issue. If you draw the T from the AD peak in April 1998 to the last bottom in early 2003, it's true that the final projected top is several hundred points late on the S&P in early 2008.
Terry's solution is to split the bottoms. There are actually 3 bottoms from mid-2002 to early 2003 and some discretion in where to split the bottoms. I'll have to go back and research exactly where Terry put the center post and why he put it there.
My solution is a little different, because T12 also presents a divergence issue on the left side of the T. The AD Line peaked on April 2 1998, but the S&P peaked on July 20, 1998 before a substantial correction. So I would start T 12 in the middle of that divergence in late May 1998.
Using the final bottom in early March 2003 as a center post produces a target final top right on the nose of the last gasp of the S&P on December 10, 2007 at 1520. The S&P dove 240 points over the following 6 weeks - the nulled echo low theory in action.
In a sense, just as there were 3 bottoms in 2002-03, there were 3 tops in 2007 above S&P 1500 - July, October and December (even though the December top was ~50 points shy of the October top and ~35 points shy of the July top). By altering the start date of T12 and using the final bottom, we correctly identified the final top before things went to hell.
I use the same procedure to tweak T13. There is divergence between the AD peak in early June 2007 and the S&P peak in July of 2007. So, instead of starting T13 at the AD peak, I start it in late June 2007 at the midpoint of the divergence.
From that start date to the first low on November 20, 2008 produces an April 26, 2010 top. From that start date to the second low on March 6, 2009 produces a final top of November 12, 2010 (after which we should see a significant decline).
Which is a long way of saying that I agree with Terry that you should not draw a T from the AD peak to the last bottom of a double/triple bottom pattern.
Hope this helps,
Parker
Parker does your work call a "range" for the Oct 18 low and a "high" for the Nov 12 peak? Thanks. Enjoyed reading your comment on null echo
ReplyDeleteHi b
ReplyDeleteI don't use any unique price projection formulas. I look at Terry's envelope theory, as well as Fibs and gaps.
Parker, would you give us an idea of your average annual % gain ever since you started trading. You must be doing well to give up your lawyer career. Thanks.
ReplyDeleteQuy
ReplyDeleteMainly, I chose trading over law because I love trading/investing, was burned out on law, and life is too short to not do what you love.
That said, I just finished my first year trading for a living back in June, and I am happy to report that financially, my first year trading was better than my best year practicing law. I hope I am fortunate enough that I can repeat that outcome.
Hi- as of 2:30pm on OCT 20th- the market is again relentless in its strength. We are nearing the OCT 18 high in the S&P500 and other markets. Do you foresee any sort of sustainable correction before we reach your NOV 12th peak date?
ReplyDeleteAgain- Terry's Aug 26 peak date turned into a massive Low- not very helpful. Do we face a similiar situation come Nov 12th? Thanks!