S&P 500 Cycles

Cyclical picture of long periods S&P 500

Purpose is demonstrating, if ever someone feels the need yet, that stocks, primal goods and indexes are “cyclical”, and making speculation without knowing cyclical (i.e. periodical) structures is “deeply penalizing”.

Graphic n° 1 : Jul 1996 – Nov 2002

Graphic n° 2 : Nov 2002 – Mar 2009

Graphic n° 3 : Mar 2009 – Jul 2015 (approximately)

I’d like point out that there’s no alignment at all between “starting point” – “closure” of pre-calculated cyclical models and the real market trend. While normally is advisable, when required, re-aligning pre-calculated models with real market trend.

The misalignment between two cyclical models demonstrates the “deep regularity” of US market from 1996 up today (to be more precise, starting also earlier 1996).  

I have investigated also earlier in time and such regular cyclical structure is kept in a very “remarkable” manner. I’d loved working on data from 1990, but at the moment I have to please myself only with data in my possess.

I’m quite jealous of my analytical works but, in case I present some kind of study, I feel the ethical need of providing technical explanations in support.

In graphic n°3, it’s specified “nonesuch” 1737 (last page), but what does it mean??

Timing says that approximately 300 days of stock market are left before closure of a “very important cycle”, that means:

Point n° 1: first prices break down 1737, the more “disastrous” correction will be (like graphic n° 2) so that instead of a simple correction, it will look like a real collapse accompanied by panic and a heavy titles sell-off, with great losses (for those who are in long position).

“First” means that since, at present, 300 days of stock market are left before closure of aforementioned cycle, the breakthrough will take place close to 300^th day. Considering that time is always passing by, tomorrow there will be 299 days left, the day after 298 days will be missing and so on: according to this, it is obviously impossible that next week a breakthrough take place, since today index quotes 1860, therefore it is required other time passing (before level will be reached), as a sort of countdown.

Point n° 2: what does it happen if prices break down 1737 when (for instance) 60 days will be left before cycle closure? Price correction will be more and more “smooth”. Therefore the corrective action will be “important” but, probably, much less abrupt and more controlled.

Point n° 3: what does it happen if on the other hand 1737 level won’t be “broken down”? The minimum level generated at the cyclic structure closure will take over for the next future of the whole market.

According to this, future will become as minimum the new “nonesuch”, and will gain rightly this title since this will become the minimum level of a “superior” cyclic period. If this new minimum level, after its new formation, will be broken down, this could lead to a new period of global recession or at least a small growth (collapse followed by a long phase of accumulation).

(it would be advisable analyzing cyclic structures with twenty years period, if further details would be required) .

If, on the other hand, the new future minimum level will stand up, this will lead to a “brand new era” of prosperity for the whole world, more and more guided by the corresponding necessity of primal goods and high techs.

Fundamentally if the new generated minimum (that will take place approximately on July 2015?) won’t be violated by lower prices within 8 months, we will assist to the achievement of new heights ever reached by financial markets (a brand new era of economic expansion)

You’d be better saving this analysis!

Stay tuned !