Friday, January 20, 2012 3:24:46 PM
SPY review + charts:
Position flat, having exited long SSO 1/19 basis SPY 131.18. LT objective 140 SPY.
Chart targets are a ten for a dime, but IMHO when different methods/calcs agree then one should take note; on this case three such coincident targets.
The high in Oct of 128.60, followed by low of 115.47, and subsequently new highs has generated a swing objective of 139.20-141.73.
If a moving average with length half as long as a known cyclic wavelength changes direction from down to up, the price at the time represents a move of half of the total move from the extreme price which occurred while the direction was down.
For the 26 week cycle, the MA65 changed direction when the centered MA7 was near 124.25; for the 39 week cycle the MA97 changed direction with the centered MA7 again at 124.25 (a wholly different time, though). So the extreme seen occurred in the Aug-Oct crisis. The low in Aug of 109.01 matches the low close in Oct so an extreme value of 109 is reasonable, giving a difference of 15.25, and a target of 139.50.
The swing obj range of 139.20-141.73 and the two half wave objs of 139.50 certainly impress me, and I will beusing SPY 140 as my target until a long term method points down.
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Moving averages can be used with Hurst cycles, and three of the major ones are 78weeks, 39weeks, and 13weeks. In the chart above, the blue MA79 shows the sum of all cycles longer than 79weeks and is moving higher. I use a MA19week or MA97daily to reflect the quarterwave direction: if one draws trendlines parallel to these and fitted against the relevant price action, the violation signals a change in direction for the fullwave 78week cycle. At this time, SPY is above the MA19weekly and hence the 78 week cycle is headed higher.
The 39 week MA filters out the shorter cycles, and being a halfwave cycle, allows price projections at the point where the directional sign changes from negative to positive. At that point, the price has moved 50% of the total move, so the projection is made be adding the move to the current price to get the target. The MA39 is still headed down so that projection is not available yet.
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Position flat, having exited long SSO 1/19 basis SPY 131.18. LT objective 140 SPY.
Chart targets are a ten for a dime, but IMHO when different methods/calcs agree then one should take note; on this case three such coincident targets.
The high in Oct of 128.60, followed by low of 115.47, and subsequently new highs has generated a swing objective of 139.20-141.73.
If a moving average with length half as long as a known cyclic wavelength changes direction from down to up, the price at the time represents a move of half of the total move from the extreme price which occurred while the direction was down.
For the 26 week cycle, the MA65 changed direction when the centered MA7 was near 124.25; for the 39 week cycle the MA97 changed direction with the centered MA7 again at 124.25 (a wholly different time, though). So the extreme seen occurred in the Aug-Oct crisis. The low in Aug of 109.01 matches the low close in Oct so an extreme value of 109 is reasonable, giving a difference of 15.25, and a target of 139.50.
The swing obj range of 139.20-141.73 and the two half wave objs of 139.50 certainly impress me, and I will beusing SPY 140 as my target until a long term method points down.
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Moving averages can be used with Hurst cycles, and three of the major ones are 78weeks, 39weeks, and 13weeks. In the chart above, the blue MA79 shows the sum of all cycles longer than 79weeks and is moving higher. I use a MA19week or MA97daily to reflect the quarterwave direction: if one draws trendlines parallel to these and fitted against the relevant price action, the violation signals a change in direction for the fullwave 78week cycle. At this time, SPY is above the MA19weekly and hence the 78 week cycle is headed higher.
The 39 week MA filters out the shorter cycles, and being a halfwave cycle, allows price projections at the point where the directional sign changes from negative to positive. At that point, the price has moved 50% of the total move, so the projection is made be adding the move to the current price to get the target. The MA39 is still headed down so that projection is not available yet.
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