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Cycle Analysis... a way of looking at price action.


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Cycle Analysis... a way of looking at price action.

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  #31 (permalink)
 glennts 
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richw View Post
Oh, I just realized I was looking at 6E on your post, but I thought it was ES and was wondering why the prices were so different. I think price is well extended down into areas that I look at and am expecting a rebound. I will share something when I can get a few minutes.

Sorry about that. I had both a 6E and ES workspace open and the charts in each were linked. When they were rolled over the 6E chart showed up in the ES workspace and I didn't catch it right away. Have added an ES version to that same earlier post

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Can you help answer these questions
from other members on futures io?
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  #32 (permalink)
 glennts 
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Because it is interesting.

A few charts earlier was posted a 6E chart that was used to illustrate the "is it above, is it below" method. You will notice on that chart that under the 24 Hr Swing High label price put in a Double Top on either side of the @6 Hr Session Cycle Low. The first High of that Double Top was the High of the 1st Session Cycle out of the 24 Hr Low. The second High of that Double Top was the High of the 2nd Session Cycle out of the 24 Hr Low.

Two important observations spilled out from this behavior and this provides a good demonstration of the need for some basic logic puzzle solving skills.



Because the 24 Hr Cycle rotation determines the Trend of the Session Cycle ( SC, @6 hrs ) and if "7" is in fact a higher SC Low, then the SC is now trending higher.... the upside of the 24 Hr Cycle. The up closing 60 Min candle after "7" and the next bar which made a new Hrly High seemed to be confirming this fact. The Dotted white live crossing the corner is the 24 Hr SMA... a likely target for this up trending SC. However, that second bar dramatically reversed and in doing so, took out "7's" Low. So either "7" was not a SC Low and price was now looking for it, or if "7" was going to stand as a SC Low then this is a new SC that has broken the back of the 24 Hr Cycle push higher and is also an extremely Left Translated SC. Because the 24 Hr rotation determines how the SC is going to behave, the only way a Left Translated SC could occur is if the Dominant / Higher Time Frame 24 Hr Cycle had rolled over and was dumping supply into the SC's attempt to push higher. Price was now on the backside of that 24 Hr rotation. A 24 Hr High was in place.

If you go to the Summation Principle video above and start at @ 1:30 you get an explanation of how a Double Top can occur. In the video the cycle durations used to illustrate this behavior were 7 Hrs and 60 Mins. But in this chart we are looking a 24 Hr and 7 hr cycle durations. The application of the same principles on different pairs of adjacent higher time frame / lower time frame cycles. If you can figure out how this works on one set of cycles then you will know how to use it across all time frames because this approach recognizes and takes advantage of the fractal nature of price movement.

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 glennts 
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glennts View Post

If you can figure out how this works on one set of cycles then you will know how to use it across all time frames because this approach recognizes and takes advantage of the fractal nature of price movement.

From post #4:

"This Dominant / Minor Cycle relationship can be found across all time frames including all the way down the 90 sec and the 5 Min time frames."




The shortest cycle that behaves well is @ 90 sec and it has a Minor Cycle / Dominant Cycle relationship to the next higher time frame 5 Min Cycle which itself has a Minor / Dominant Cycle relationship to the next higher time frame @ 15 Min Cycle.

On this 15 Sec ES chart there is a white 90 Sec ma, a black 300 sec ( 5 Min) ma and a yellow 15 min ma. If you look closely at the bars you can see the swings of the @ 90 Sec Cycle ( 6 bars ). Seems pretty extreme to get this far down into the noise but consider that what you are looking at are the swings that scalpers get beaten up by. If the bulls cannot hold the line and lift price for at least 90 sec, what is the point of getting long then and there?

The Dynamic Band ( self adjusting ) is an indicator I developed to show swing momentum and I don't let it loose in the wild. The bottom two sub graphs are price de-trended against the 90 sec ma and a Double CCI which is a stacked fast and a slow CCI reflecting the durations of the 5 min / 15 Min pairing. The dots on the chart above/below the swing high/low are generated by this Double CCI.

From an earlier post: "When you use your indicators in a way that reflects the cycles you are tracking they then become tools that contribute directly to your understanding of the evolving story."


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 tradepips 
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glennts View Post
If you go to the Summation Principle video above and start at @ 1:30 you get an explanation of how a Double Top can occur. In the video the cycle durations used to illustrate this behavior were 7 Hrs and 60 Mins.

Thanks! I re-watched that part of the video and then took a look at today's ES chart. Just as the Summation Principle video explained how double tops are formed in a 7 hour cycle high, today's 7 hour cycle low was a double bottom made up of two hourly cycle lows.


06-10-2022 Double Bottom


Also, the sienna colored 7 hr SMA provided resistance to today's 7 hour long cycle, the backside of the 24 hr cycle.

The other SMAs are 60 min, 15 min and 5 min.

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 glennts 
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As this thread develops one of my concerns is presenting information in a way that actually helps the viewers figure out what this is all about. Because the posts often comment on real time events what is discussed is somewhat dictated by those events and that may not be the best way to coherently tie all this stuff together.

So, there are a few hundred hours of videos from earlier times that I have been going thru trying to address this problem and the one posted below does a fairly good job of presenting a conceptual overview and referencing and explaining behavior and the reasoning that has been brought up in earlier posts. And it does so is a way that brings out the relevance of the Dominant / Minor Cycle relationships that are at the core of this approach.

Let me know if this is helpful.

The video is from the first trading day of 2012.



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 glennts 
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This video is from the week following the above and continues the analysis and reasoning behind trying to figure out what price is likely to do next.


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 glennts 
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Ok, adding to the above videos are this series of Monday - Friday Pre-market Analysis videos from the week 1.16.12. Hopefully in this collection there will be enough repetition and elaboration of the main themes that it may start to make some sense and you may find some ideas that are useful.

Projections of next Highs or Lows is often mentioned. I get these from going from the last obvious high or low and taking the duration between it and the 5th previous same cycle duration high or low. Divide by 5 and you have the average of 5. You could go back 3 or back 10 and determine that average but I have found 5 to be a good compromise between too sensitive to current dynamics or not sensitive enough. An easy way to do this is take the Fib. Time Extension tool and set the extension to 20%. When you stretch it back over 5 occurrences you get the average of 5.






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 glennts 
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A continuation of the above.






Not sure how much more I can do to discuss Cycle Analysis Theory in this thread. Depending on what kind of response these examples of daily pre-market analysis videos receive I may start creating and posting similar pre-market analysis videos for each day's trading in the Elite section.

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 glennts 
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Longer term considerations.



When the first series of charts in this thread were moved over from the Spoo analysis thread, 5 charts in that group were lost in the transition. One of them was an earlier version of this Monthly chart which extends back to 2010.

The dashed lines mark each H-H and L-L Swing durations and with the exception of the last L-L count, the average rotation was 42.4 Months. The White circles highlight the Swing Lows of these Multi-Year Cycle rotations and it is on the inside edge of the 12 Month S/R band where those Lows found the support they were looking for. The last rotation Low is the Covid sell off and is ignored in the average calculation. Yet even in that extreme drop, price dropped a tail well below the edge but the candlestick bodies remained above that area of support. Currently that level of support is at 3722 which is an acknowledgment of where this move will certainly reach. The "how" and the "when" of that event is less clear.

Today is the 16th day of this Multi-Week Cycle which has a average duration of 15 Days. On that bases price is closer in time to the end of this immediate decline than the beginning and it is reasonable to see a push higher at some point to test for resistance.

Can reports about the economy override this expectation? Of course they can... just look at the Covid drop.

As a trader focused on what price might do during the Globex Session my highest time frame consideration is the Multi-Day Cycle.... the rise and fall between weekly highs and lows. Those swings determine how each 24 hr Cycle is likely to behave and that lower time frame will then determine what price is going to do during the six or so hours I'm sitting in front of my screens. What happens on the Multi-Year, Multi-Month or Multi-Week levels has no bearing on my next trade.

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Good luck, Be careful.

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 glennts 
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...... The White circles highlight the Swing Lows of these Multi-Year Cycle rotations and it is on the inside edge of the 12 Month S/R band where those Lows found the support they were looking for. ....Currently that level of support is at 3722 which is an acknowledgment of where this move will certainly reach.


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