You are viewing an obsolete version of the DU website which is no longer supported by the Administrators. Visit The New DU.
Democratic Underground Latest Greatest Lobby Journals Search Options Help Login
Google

Reply #4: WrapUp by Tim W. Wood [View All]

Printer-friendly format Printer-friendly format
Printer-friendly format Email this thread to a friend
Printer-friendly format Bookmark this thread
This topic is archived.
Home » Discuss » Latest Breaking News Donate to DU
ozymandius Donating Member (1000+ posts) Send PM | Profile | Ignore Mon May-10-04 07:57 AM
Response to Original message
4. WrapUp by Tim W. Wood
THE DOW REPORT
A Brief Overview of Cycles

In recent weeks I have shown you how I use cycle high and low points to identify trend changes. I have recently received questions asking for more of an explanation about these methods. So, in todays WrapUp I will attempt to present a brief simplified explanation of just how cycles can be used as a very powerful technical tool once they are understood.

From a cyclical perspective, the trend is defined by the direction of the cycle of the next larger degree. This means that from a cyclical perspective we work in many different dimensions. The key is to isolate and study each cycle of each dimension so that the direction and expectation of these cycles can be known. The identification of these cycle lows is definitely outside of the scope of this brief overview, as it would take volumes of material to do this subject justice. All I want to do here is simply present the concept of using cycle highs and lows of various degrees to show you the concept of how we can work in the various dimensions to identify important turn points.

-cut-

In my work with cycles I also use statistical analysis of the long and intermediate-term cycles to develop expectations that can be applied to future cycles. For example, history may show me that 89% of all long-term cycles, that advance for 6 months or more, hold above their previous long-term low as the correction into the next long-term low occurs. Further analysis of these long-term cycles with advances of 6 months or more is then done in order to find the average advance of this group of cycles. The same is done for the declines into the lows. Analysis of the long-term cycle may also reveal that when this cycle advances for 5 months or less, the previous cycle low has an 83% probability of declining below its previous low and that the average decline may be 39%. These numbers above are all arbitrary, but I present them to you as an example of just how the quantification of cyclical behavior can be used as a guide for future cycles. The key is to identify the cycle of each degree or dimension and then apply the historical norms to the cycle. Basically, this is nothing more than cycle profiling.

http://www.financialsense.com/Market/wrapup.htm
Printer Friendly | Permalink |  | Top
 

Home » Discuss » Latest Breaking News Donate to DU

Powered by DCForum+ Version 1.1 Copyright 1997-2002 DCScripts.com
Software has been extensively modified by the DU administrators


Important Notices: By participating on this discussion board, visitors agree to abide by the rules outlined on our Rules page. Messages posted on the Democratic Underground Discussion Forums are the opinions of the individuals who post them, and do not necessarily represent the opinions of Democratic Underground, LLC.

Home  |  Discussion Forums  |  Journals |  Store  |  Donate

About DU  |  Contact Us  |  Privacy Policy

Got a message for Democratic Underground? Click here to send us a message.

© 2001 - 2011 Democratic Underground, LLC