Is this a coincidence or a real cycle?

82-85 days seems to be where the current rally runs out of steam, and needs to gather itself to make anew run higher.

Courtesy of The Chart Store

I would imagine this is a combination of many factors: Rally strength, preceding sell off, amount of cash flowing into retirements accounts, etc.

Or, it could be just random coincidence.

Category: Cycles, Technical Analysis

Please use the comments to demonstrate your own ignorance, unfamiliarity with empirical data and lack of respect for scientific knowledge. Be sure to create straw men and argue against things I have neither said nor implied. If you could repeat previously discredited memes or steer the conversation into irrelevant, off topic discussions, it would be appreciated. Lastly, kindly forgo all civility in your discourse . . . you are, after all, anonymous.

12 Responses to “How Cyclical Are Market Rallies?”

  1. cognos says:

    Uh… 85…. 82… 62… seems to be more likely the pattern fits to the bottom in late Jan (also late Oct).

    Why forecast a fake 3rd 80s?

    The next number then is somewhere 50-90. I would say it looks more like one should look at it in terms of 10-15% run-ups, follower by 5-10% sell offs. I’d look for 1220, selling off to 1150… moving to 1300.

    But these things always depend on news and info. Q1 earnings will be good and step-up TTM eps by $8-9/shr on SPX. At a rough 18x multiple thats 150 pts. (Oh wow, that fits my 10-15% run up expectation).

  2. b_thunder says:

    I think it’s neither a combination nor a coincidence.
    It’s all about the quarterly earnings reports. Sell into the earnings for 2-3 weeks, then buy hope for next 2.5 months.

  3. Marcus Aurelius says:

    Does Martin Armstrong know about this?

  4. cognos says:

    There also a loose month-end / month-begin phenomenon under the data.

    Check out the early days of:
    - Sep (7/9 up days, up 5%)
    - Oct (8/11 up days, up 4%)
    - Nov (6 straight up days, up 5.5%)
    - Dec (7/9 up days, up 2%)
    - Jan (6 straight up days, up 3%)

    With then the latter half of the month being tougher (see esp Oct, Jan).

  5. Mr.E. says:

    Don’t think it’s coincidental – aligns well with earnings reporting cycle, both duration and timing. Pullback ahead, react and run-up after until the next one is approaching, then regroup to do it again.

  6. Patrick Neid says:

    1228 on the spooz or bust! The bears have had their shot near term.

  7. Simon says:

    Please note the declining 50 day MA

  8. Mr.E. says:

    Simon Says

    “Please note the declining 50 day MA”
    ———————————————————————–
    Broken today and at worst slope is now flat on the S&P Index. Big difference now is between small & midcaps ( RUT, SML, MID, Nasdaq) all showing strength, and the large caps (DJIA/INDU, SPX, NYA,XII) showing relative weakness. If the big caps join in this will probably get exciting fast.

  9. cognos says:

    Very quiet comments.

    This crowd doesnt even want to look at that chart.

    It contradicts their fundamental beliefs.

  10. Cognitive dissonance rears its ugly head.

  11. deadhead says:

    maybe it matches with the full moon, new moon cycles which have indicated turning points fairly accurately the last several months from the charts that I’ve seen.

    maybe Bernanke starts bobbing for apples around 80 days and then wakes up to resume emini purchases, particularly late Sunday nite/early Monday a.m.

    yep, I know that most here seem to disagree including BR, but the truth will out itself some day that the Fed not only buys the minis (direct or indirect, it doesn’t matter) but owns common as well.

  12. cognos says:

    deadhead — you’re an idiot.

    How much does the Fed own in Eminis?
    When did they buy it (i.e. they must be up HUGE… considering the last years run-up)?

    The Emini trades about $60B per day… so the Fed could comfortable liquidate about $15B per day. Or about $300B per month. More if they strategically used after market. (It trades $1-2T per month!)

    Who is on the other side of the trade and “short” all this ES to the Fed? Given that the Fed must be up $100s of Bs… why arent the shorts bankrupt yet? Maybe China has been shorting?

    Is the US national debt now zero… given that the Fed owns the entire $12T in SPX market cap through the Eminis… and they are up $5T? (Since they bought it all last March 5th). Who will meet this margin call? (Or should I say “when will China meet this margin call”?)

    So dumb…. “like such as the Iraq”…