Cycle Trading

[No-Quarter]

I will try to be as clear as I can.

I was looking back @ 2009 crash and noticed 10/08/2007 was all time high back then and took almost 2 years to reach rock bottom...is the world financially in the same boat??? I think our economy is stronger...BUT...we still have same market signals...recent all time high was 12/27/22...1 year later we are at a cliff, is it the cliff before the real drop or is it a cliff before a drop then bounce, then bigger drop??? How long do cycles last??? 4 weeks 6 weeks??? We gotta be able to analyze the time between cycles as well...hmmm...got a headache yet??? lol...

I don't know and I don't care to analyze history.

I don't know and I don't care if the economy is stronger or weaker.

I don't know and I don't care to analyze time periods between cycles.

All I care about is what the market and sector charts are saying to me today.


To do this, I break down the market into the 11 SPDR sectors and add 3 overall market indicators. Jaws and Duma call these 'the big three'. I create a bullish percent or breadth indicator for each sector and each of the three market indicators. The 3 Big Three market indicators are the S&P 500, the Nasdaq 100, and the Russell 2000. So 14 total.

The 11 sectors are - https://www.sectorspdr.com/sectorspdr/

https://seekingalpha.com/article/4475586-stock-market-sectors?gclid=Cj0KCQiAqOucBhDrARIsAPCQL1Z5TEh5r4l-pb4hB0YhiVZbq2goztclmAJuY-UBZGtlfZQUs2Xa9zcaAqXiEALw_wcB&internal_promotion=true&utm_campaign=15199871039&utm_medium=cpc&utm_source=google&utm_term=130394020238%5Eaud-1393135134182%3Adsa-402690192841%5E%5E559673290317%5E%5E%5Eg


The 3 Big Three market indicators are the S&P, the Nasdaq, and the Russell 2000.

Here is the definition of a breadth indicator - https://www.investopedia.com/terms/b/breadthindicator.asp#:~:text=Breadth%20indicators%20are%20mathematical%20formulas,a%20stock%20index's%20price%20movements.

https://stockcharts.com/search/?q=%22Bullish%20Percent%20Indices%22§ion=symbols

https://stockcharts.com/search/?section=symbol&q=itbm


Here are my 3 overall market, and 11 sector bullish percent/breadth indicators.

https://stockcharts.com/h-sc/ui?s=%24BPSPX&p=D&yr=1&mn=1&dy=0&id=p52587820339
https://stockcharts.com/h-sc/ui?s=%21ITBMRASPX&p=D&yr=1&mn=1&dy=0&id=p19618477856
https://stockcharts.com/h-sc/ui?s=%24BPCOMPQ&p=D&yr=1&mn=1&dy=0&id=p56057290514
https://stockcharts.com/h-sc/ui?s=%21ITBMRANAS&p=D&yr=1&mn=1&dy=0&id=p80217190236
No Bullish Percent chart for the Russell 2000 available on Stockcharts, so I only use the Breadth Momentum chart.
https://stockcharts.com/h-sc/ui?s=%21ITBMRASML&p=D&yr=1&mn=1&dy=0&id=p61588152245

https://stockcharts.com/h-sc/ui?s=%24BPINFO&p=D&yr=0&mn=6&dy=0&id=p39960005813
https://stockcharts.com/h-sc/ui?s=%24BPHEAL&p=D&yr=0&mn=6&dy=0&id=p11765251175
https://stockcharts.com/h-sc/ui?s=%24BPDISC&p=D&yr=0&mn=6&dy=0&id=p09464854005
https://stockcharts.com/h-sc/ui?s=%24BPCOMM&p=D&yr=0&mn=6&dy=0&id=p72913245449
https://stockcharts.com/h-sc/ui?s=%24BPFINA&p=D&yr=0&mn=6&dy=0&id=p32862865985
https://stockcharts.com/h-sc/ui?s=%24BPINDY&p=D&yr=0&mn=6&dy=0&id=p58894081979
https://stockcharts.com/h-sc/ui?s=%24BPSTAP&p=D&yr=0&mn=6&dy=0&id=p08104063330
https://stockcharts.com/h-sc/ui?s=%24BPUTIL&p=D&yr=0&mn=6&dy=0&id=p17036187596
https://stockcharts.com/h-sc/ui?s=%24BPMATE&p=D&yr=0&mn=6&dy=0&id=p68685424654
https://stockcharts.com/h-sc/ui?s=%24BPREAL&p=D&yr=0&mn=6&dy=0&id=p84760610708
https://stockcharts.com/h-sc/ui?s=%24BPENER&p=D&yr=1&mn=1&dy=0&id=p82354804841


When the bullish percent breadth indicator chart moves from trending down to trending up (the PSar flips), take a position in the corresponding ETF, timing the entry and exit using the individual ETF chart.

Likewise, when the indicator moves from trending up to trending down (again, the PSar flips), take a position in the corresponding inverse ETF. Be aware, not all 11 SPDR sectors have a corresponding inverse ETF.


The ETF's I use for the 3 overall markets are -

https://stockcharts.com/h-sc/ui?s=SPXL&p=60&yr=0&mn=1&dy=0&id=p26753928687https://stockcharts.com/h-sc/ui?
https://stockcharts.com/h-sc/ui?s=SPXS&p=60&yr=0&mn=1&dy=0&id=p26753928687https://stockcharts.com/h-sc/ui?

https://stockcharts.com/h-sc/ui?s=TQQQ&p=60&yr=0&mn=1&dy=0&id=p26753928687https://stockcharts.com/h-sc/ui?
https://stockcharts.com/h-sc/ui?s=SQQQ&p=60&yr=0&mn=1&dy=0&id=p26753928687https://stockcharts.com/h-sc/ui?

https://stockcharts.com/h-sc/ui?s=TNA&p=60&yr=0&mn=1&dy=0&id=p26753928687https://stockcharts.com/h-sc/ui?
https://stockcharts.com/h-sc/ui?s=TZA&p=60&yr=0&mn=1&dy=0&id=p26753928687https://stockcharts.com/h-sc/ui?


The ETF's I use for the 11 SPDR sectors are -

https://stockcharts.com/h-sc/ui?s=TECL&p=60&yr=0&mn=1&dy=0&id=p26753928687https://stockcharts.com/h-sc/ui?
https://stockcharts.com/h-sc/ui?s=TECS&p=60&yr=0&mn=1&dy=0&id=p26753928687https://stockcharts.com/h-sc/ui?

https://stockcharts.com/h-sc/ui?s=CURE&p=60&yr=0&mn=1&dy=0&id=p26753928687https://stockcharts.com/h-sc/ui?

https://stockcharts.com/h-sc/ui?s=WANT&p=60&yr=0&mn=1&dy=0&id=p26753928687https://stockcharts.com/h-sc/ui?

https://stockcharts.com/h-sc/ui?s=XLC&p=60&yr=0&mn=1&dy=0&id=p26753928687https://stockcharts.com/h-sc/ui?

https://stockcharts.com/h-sc/ui?s=FAS&p=60&yr=0&mn=1&dy=0&id=p26753928687https://stockcharts.com/h-sc/ui?
https://stockcharts.com/h-sc/ui?s=FAZ&p=60&yr=0&mn=1&dy=0&id=p26753928687https://stockcharts.com/h-sc/ui?

https://stockcharts.com/h-sc/ui?s=DUSL&p=60&yr=0&mn=1&dy=0&id=p26753928687https://stockcharts.com/h-sc/ui?

https://stockcharts.com/h-sc/ui?s=VDC&p=60&yr=0&mn=1&dy=0&id=p26753928687https://stockcharts.com/h-sc/ui?

https://stockcharts.com/h-sc/ui?s=UTSL&p=60&yr=0&mn=1&dy=0&id=p26753928687https://stockcharts.com/h-sc/ui?

https://stockcharts.com/h-sc/ui?s=UYM&p=60&yr=0&mn=1&dy=0&id=p26753928687https://stockcharts.com/h-sc/ui?

https://stockcharts.com/h-sc/ui?s=DRN&p=60&yr=0&mn=1&dy=0&id=p26753928687https://stockcharts.com/h-sc/ui?
https://stockcharts.com/h-sc/ui?s=DRV&p=60&yr=0&mn=1&dy=0&id=p26753928687https://stockcharts.com/h-sc/ui?

https://stockcharts.com/h-sc/ui?s=NRGU&p=60&yr=0&mn=1&dy=0&id=p26753928687https://stockcharts.com/h-sc/ui?
https://stockcharts.com/h-sc/ui?s=NRGD&p=60&yr=0&mn=1&dy=0&id=p26753928687https://stockcharts.com/h-sc/ui?


I do screw around with a few individual stocks, and other ETF's, NatGas being one. Gold is another -

https://stockcharts.com/h-sc/ui?s=%24BPGDM&p=D&yr=0&mn=6&dy=0&id=p20416401671

https://stockcharts.com/h-sc/ui?s=GDXU&p=60&yr=0&mn=1&dy=0&id=p26753928687https://stockcharts.com/h-sc/ui?
https://stockcharts.com/h-sc/ui?s=GDXD&p=60&yr=0&mn=1&dy=0&id=p26753928687https://stockcharts.com/h-sc/ui?


...and the comparison chart between 2008-2009 and 2022 with the man looking over the cliff is a novelty. Nothing more. To use it for trading would be similar to driving a car forward using only the rearview mirrors. Won't know if you are in trouble until it is big trouble.

I just gave you a master class in swing trading, and the charts to make it work for you. Let me know if questions.

Merry Christmas!