Trade of the Day.

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All of the reasoning that produced these trades has been discussed numerous times throughout the thread. Because of the cyclic nature of the Dominant / Minor Cycle relationships, Cycles in similar situations will behave in similar ways. You will find earlier charts of catching 24 Hr Lows that will look very similar to these. The setups are always the same and are based upon understanding what represents Minor Cycle S/R inside the Dominant Cycle Rotation. Get past the hard stuff and the doing of it is not that difficult as long as you don't get in your own way.

glennts 

Center of rotation. When a moving average correctly reflects the cycle duration on that time frame it will serve as the center of rotation. .... The above is a recent section of the earlier chart. Price is currently @ 80 points above the Zero. The magenta horizontal above that is another 80 points or @ 4005. The top horizontal is 240 points above the 3 Week ma Zero line or @ 4086.

This is why I do this.

This is going to be complicated. More so than the normal complicated.



Every thing I do boils down to pattern recognition but instead of the typical patterns everyone is familiar with, I look at the patterns formed by the interaction between Dominant and Minor Cycles. In practical terms we are all looking at the same things but seeing them thru a different lens.

Do this long enough and you get a sense of patterns that normally occur with the turns of cycles on various time frames. ie: an Hourly Low, Session Cycle Low, 24 Hr or Multi-Day Low. The process they go through to put in a Low is very similar in that they involve finding and testing support levels. The higher the time frame the longer this process takes. An Hourly Cycle can get thru its turn in 10 Mins. A 24 Hr turn can take 2 - 3 hours. In a Month you can see up to 200 Hourly Cycle turns and over years of trading, you build a memory bank of how these events will play out on your charts.

With the Multi-Year Cycle and a turn every 3+ years, I've sat thru at least nine... actually more than that but in those early days I hadn't yet figured out what I was looking at.

Because of the similarities in Dominant / Minor Cycle interactions, what you see play out between the 6 Hr Dominant and 60 Min Minor will not be very different than that between the Multi-Day and the 24Hr Cycle. The fractal boxes within boxes idea.

When I look at what is playing out during what has been described, and so-far behaved as the possible turn up out of a Multi-Year Cycle Low, and I reach down thru the time frames looking for similar patterns, all I come up with is a nagging feeling that this is a corrective pattern.

Mentioned early on in the process was my wanting to see a test of the 6.17 Low. That would have given a solid logical base to this turn and a "look" that is common to "good" lows put in on the lower time frames. Show me a Double Bottom or a inverse H&S and I'm a happy guy.

This chart has been marked to highlight what strikes me as a "corrective" look. The White solid lines and arrow point to the bar counts of the larger rotation... 17, 19, and 18 bars. The White dashed line looks at the days up out of each of the shorter rotations... 6 in each case. The Yellow circles are the bar counts of these rotations... 9,8,10 and 10.

If anything, what these numbers should impress you with are their consistency. Corrective patterns tend to be very well behaved... they are orderly.

At some point as price turns up out of a low, the H-H durations seen in the turn will begin to lengthen as price is able to push up higher and longer before meeting any meaningful resistance. That hasn't happened yet.

At the beginning on this week price broke the back of the downtrend and turned the trend of the Multi-Week Cycle Higher. This is higher time frame bullish. After breaking Resistance it needs to test those levels for support and that process may have started with today's lower closing bar. The expectation is for a rotation similar to the earlier two and a return to the Middle of the Band where price will find the Monthly Pivot, the dashed horizontal at a convenient 50% retracement. If price likes what it finds then a more concerted push to the upside may kick in.

To be fair, what is underlying all of this is the original thesis put forward weeks ago from an analysis of the 20 yr Monthly charts and how the earlier MY Cycle Lows were put in place. With one week left for the July bar to repeat the previous MY Low behavior, next week is either going to be one for the history books or price is going to nope out and do something different. Does not matching the behavior of the earlier lows argue this might not be a MY Low? Not at all... only breaking the 6.17 Low would do that.

As a caveat, look at those original Monthly charts when the idea of a MY Cycle Low was first introduced and notice what I had marked out as a place where price would go should this level not hold.

So, I've watched thousands of Hourly Cycle rotations but only a handful of MY Cycle turns. Looking forward to seeing how this one plays out.

Good luck , Be careful.

glennts 

As a caveat, look at those original Monthly charts when the idea of a MY Cycle Low was first introduced and notice what I had marked out as a place where price would go should this level not hold.

Posted 5.12.22



Not saying it will. Not saying it won't.

But it's a good idea to be aware of alternate scenarios so that you can develop a 'Plan B' strategy and not be caught flat footed.

'Praemonitus, Praemunitus'

ES 1440 Min Bars. MW S/R band. The Band Middle show the trend of the MW Cycle... it is higher.
The Stochastic shows the rotation of the MW Cycle... it is rolling over.
In a Dominant / Minor Cycle relationship, when the Dominant Multi-Week Cycle rotates it will break the Minor Cycle areas of S/R. In this case the dotted Blue ma is the 5 Day SMA. In the prior rotations the MDma broke on the second day of the MW rolling over. Today it did not break.



ES 360 Min Bars. MD S/R band. The Band Middle shows the trend of the MD Cycle is higher... the upside of the MW rotation. The Stochastic shows the Multi-Day Cycle has been correcting since Friday. The rotations of the MD Cycle will break areas of White 24 Hr S/R. That occurred mid-day on Friday. At the 6:30 Hrly Bar this morning price made a Lower 24 hr High ( 4 bars ) consistent with the MD backside. The last bar of today pushed higher out of its low 23 Hrs from the Prior 24 Hr Low. If this is a 24 Hr Low it is a higher Low and inconsistent with 24 Hr Cycle behavior if the MD Low is off in the near future at a lower level.

With the MW rollling over and the MD pushing lower price has every excuse it needs to drop. But it is not doing so.

Notice the MD ma at 3951 providing support underneath today's trading as well as on Thursday.

There is nothing here that strongly argues Up or Down. The overnight trading will likely resolve the " is it a 24 Hr Low" question. With the MW rolling over it is reasonable for me to expect MD Support to break even though the current behavior is ambiguous.

Wednesday is FOMC report day. Perhaps that is what this is waiting for.

glennts 

... The overnight trading will likely resolve the " is it a 24 Hr Low" question. With the MW rolling over it is reasonable for me to expect MD Support to break even though the current behavior is ambiguous.

The rolling over of the Multi-Week Cycle continues to apply selling pressure to price with the breaking of the MD SMA but the buyers have yet to give it up. Yellow highlights the POC cluster of the past several days.




360 Min bars. On the backside of the Multi-Day Cycle rotation price will encounter resistance from the Minor 24 Hr time frame. Clear to see how the White 24 Hr ma is performing this function. 24Hr Highs and Lows have been marked with the overnight high as a candidate for today's 24 Hr High. This is the 8th day of this larger rotation which has an average of 9.

So, questions to ask. Where are the Stop Losses for those putting in this apparent floor?
If the FOMC raises rates tomorrow will the initial knee jerk reaction be Up or Down?
And if, as this thread seems to be saying, the MW rotation will always break MD support, will this be the one time it does not?

Maybe it will. Maybe it won't.

Good luck. Be careful.

glennts 

On the backside of the Multi-Day Cycle rotation price will encounter resistance from the Minor 24 Hr time frame.

On the backside of the 24 Hr Cycle rotation price will encounter resistance from the Minor Session Cycle (6 Hr) time frame.

On the backside of the Session Cycle rotation price will encounter resistance from the Minor 60 Min Cycle time frame.

Because it is interesting and there is an outside chance it might be relevant.



ES Quarterly Bars ( 3 Mth ) extending back to 2007 and the Dot Com bubble collapse.

Bar Pivots matter to me and how price interacts with them provides me with useful information.

During the Dot Com collapse there were 6 consecutive Quarters closing below their Pivots.

After the 2009 low there was never more that 1 Quarter closing below its Pivot.

That is until the start of this year with now 2 consecutive lower closings and the current bar already showing resistance from its Pivot at 4006.25 This is the September bar and it is early in its life so drawing any conclusions from these first days is very premature.

That being said.

Compare this decline with the 2008 decline.

The second bar down broke the Cyan 12 Month ma. Same here.

The third bar down put in a Higher Low and pushed above its Pivot only to reverse and close on the bar's Low. The current bar, the third bar, has a Higher Low ( so far ) and as of today's Close is attempting to push higher but has stalled at the underside of the Weekly Pivot.

Doesn't require much imagination to consider how tomorrow's FOMC announcement, assuming it will move price ( LOL), might have an impact on this particular story.

I played this game before, comparing current bar behavior with prior bar behavior over in the 6E Currencies thread and that turned out quite well.

Many questions will be answered tomorrow and no doubt new ones will be raised.

The plot thickens.



Yesterday put in a Multi-Day Cycle Low. Price is still on the backside of the Multi-Week rotation but has yet to break the back of that Higher Time Frame Cycle. Prior posts have mentioned the seeming reluctance of price to push lower.

I'm considering the overnight high to be this 24 Hr Cycle High until proven wrong. On the backside of the MW rotation price encounters MD resistance and that is highlighted in Yellow.

This puts me on the sell side and I am currently short from 3962.

The FOMC is a wildcard that can overrun anyone's expectations no matter how well thought out the are.

Good luck, Be careful.

>> This puts me on the sell side and I am currently short from 3962.<<



Took a stop for a BE trade.



This 60 Min chart shows the 24 Hr rotation.

The overnight high was taken out arguing that it was not the 24 Hr High, unless between then and now can be found a 24 Hr Low and this current push up is a new 24 Hr rotation higher.

How likely is that?

On the lower left is the prior 24 Hr Low. Price pushes up, Stochastic turns up, Price pushed up thru 6 Hr resistance and tests, then breaks 24 Hr resistance. Up out of a Multi-Day Cycle Low.

After the overnight high, the presumed 24 Hr High, price broke the Sienna 6 Hr support and for the next 3 hrs that became resistance. The backside of the 24 Hr rotation. Notice the Sienna ma did not roll over but continued to angle higher.

The rectangles are 6 Hr blocks. There are typically 4 of them in a 24 Hr Cycle. In this 4th 6 Hr block price made a lower and then broke to a new high. Could this have marked a 24 Hr Low? Possibly.

Out of a MDL price will search for the next MDH. On the upside of the MD Cycle the 24 Hr Cycle will right translate and often extend its H-H count. Is that what this is and it's not a new 24 Hr Cycle up? Possibly.

When larger cycle rotations start to push out of a turn and build momentum in a new direction the lower time frame cycles can easily be overpowered. The selling on the backside of a 24 Hr Cycle is going to instantly be absorbed by the buying demand of a MM or MY Cycle pushing higher. You get what we see here as the Sienna ma shows the 24 Hr cycle correcting not lower, not sideways but higher.

Ambiguity. Certainly. Sometimes this can only be figured out in hindsight once the dust settles and you look back to find the cycle lows and highs that must have occurred in order to explain what took place. The current bar is the 6th in what is normally a 6 hr H-H rotation. I expect it to run into resistance at the level indicated and at that point will see if how it then behaves resolves some of this ambiguity.