20 Year Cycle chart of the SP 500

Posted by Midneo on July 31, 2012 (10:15PM)

Well i think this is the big debate right. Do we go down or do we go up the million dollar question. Well all i can say no one knows for sure but i can enlightened you a bit with what i know.



Now i made this chart specially to see what is going on in the last 20 years.  Now everyone knows about the Famous ".Com bubble", then the "Housing bubble" and now the famous "Bond bubble" scary but fascinating but we are coming to a the closing of the last bubble. Unless Big Ben goes QE free money for you all :) which eventually will lead to a economic super crash in the year 2013 but don't hear the news is to much noise just follow you're charts and cycle trends. Now each cycle is divided into 3 phases each lasting 6 years each. the 6,6,6 cycle. Now i also have trends using the 100 year chart with constant estimates of market average total return. Which measures deflation purple line, normal inflation blue line, and Hyper inflation red line. See how easy it is just connecting the dots, don't you wish you paid attention in 1 Grade because I did ;).  

But getting series note we are not in a good economic situation at the moment, I do believe the domino's are about to fall but again being cautious. Now using Eliot 5 Wave theory you can see we are in the completing the 5 Waves and now in a corrective face leading to one large wave downwards and the end of the 3 cycle. with a head on shoulders pattern. So pay close attention to that. Now many people that follows cycles are following this chart 

 
Which shows the average return of the SP 500 in the previous election year. Which according to this we should be heading upwards but I don't that's the case for many reasons but for take a look at the chart at the 2007, which is called a cycle break and its going to happen again in 2012 calculating this  its proven to be a difficult task, I'm in the works on it using volume analyzes but even I'm not that smart but just follow history using old and new price models. 
 
Now one final picture I would like show you guys is the market sentiment which shows the divergence and breakpoints of cycles trends.. but anyways people are very pessimistic on the markets but are to scared to short it just look at the VIX.. But in either case you never know so becarefull 


Now I hope this gives you a perspective I want to do a full article discussion in a blog  this weekend but for now I hope this information helps you guys.. 

Posted by incubus on August 01, 2012 (01:37AM)

You've made a convincing argument that the market is going up or down, my quantitative analysis concurs, fully.

Posted by treeHamster on August 01, 2012 (03:01AM)

Sorry but I have to disagree with incy a bit. I think he's made a convincing argument the market is going up and down. So my outlook is that in the next month, the market will be up and down or maybe down and up (depending on how you like to look at the glass of water).

Posted by Market Pawn on August 01, 2012 (09:51AM)

It seems to want to trade boldly in a range between 1380 and 1390, though I suppose that's not the 20 year cycle.  To me Mid's first chart is the most fascinating in the world, because it shows better than any I've seen the long wave action of equity prices.  You can tell a very concise 20 year story from that chart.  I note that the slope of the curve in the third uptrend is flattening as everyone begins to seek yield.  I suppose that augers well for not having another Crash.  But there is another chart that is always in my mind as I ponder an era where policy makers bicker about the color of Godzilla's toenails as he rises out of the Pacific.

Of course, it's 30 years of the Nikkei 225.  There is a downside to capitalizing transfer payments, although in Japan's case, they also binged on public infrastructure.

You must Log In to post to this forum.

Not a member? Register Now to …

  • See what other traders are doing
  • Make your own trades public
  • Share your thoughts on a trade
  • Join or start a group
  • Connect with like-minded traders