Sunday, March 24, 2013

S&P500 Cyclic Commonality:



Just to review on the five cycle principles – Summation – Commonality – Variation – Nominality and Proportionality. Commonality is a condition when the cyclic peaks and troughs of the major stock sectors bunch together following periods of congestion or Variation. In other words when the peaks and troughs of cyclic rhythms and the relative magnitudes are similar when over-laid in graphic form – we have a significant buy or sell opportunity. The innovators of this graphic placement of the intermediate cycles were the great Ian Notley and Don Stark back in the early (1982) Dominion Securities Trend & Cycle days.

Our weekly chart is now displaying a cyclic commonality peak in three important S&P500 sectors - financial, industrial and technology which in total weight represent about 44% of the S&P500 index. Historically a summation of these troughs and peaks precedes a turning point or juncture. The lower high of the S&P Tech sector is also a setup for a pending cycle magnitude failure and that rarely has a good ending.  

1 comment:

Eclectic collector said...

Hi Bill,

So it appears the ideal cyclic peak of these sectors is around mid year?