Potential Short-term Signal: Stock Market Cycle Analysis

| April 12, 2012

As a result of the strong rebound today, both cycle analysis price oscillators have nearly experienced bullish crossovers and a bullish engulf pattern has formed on the daily chart. A strong close would generate a confirmed cycle low signal, suggesting that the overbought correction from last week was the alpha phase decline of the current cycle and indicating that the beta low (BL) likely formed on April 10.

The confirmed formation of the BL earlier this week would favor the development of another extended short-term cycle and forecast the formation of the next short-term cycle low (STCL) in early May. The magnitude of the alpha phase decline continues to suggest that cycle translation is in question and a weak beta phase rally followed by a move below the last STCL near 1,340 during the beta phase decline would signal a transition to left translation.

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Category: Signals, Stocks


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