Thursday, June 22, 2023

The 4 Year Presidential Cycle | Carol S. Mull

The 3 1/3 - Year Kitchin Cycle
Within the average 11.094-year sunspot cycle, there are shorter periods of solar prominence which occur every 40 or 42 months. These were first recognized in 1923 by the American economist Joseph Kitchin. They account for trade fluctuations and have a marked effect on terrestrial weather, alternating between hot and dry to cold and wet. Articles in Cycles magazine proclaim a 40.68-month cycle, an example of which follows:


The Mars/Vesta Cycle (4.17 years)
The planet Mars and the asteroid Vesta have a synodic cycle period of 4.17 years. (Mars often serves as a trigger planet to aspects of the heavier business planets (Saturn, Uranus, and Jupiter); Vesta has consistently been found in a prominent position in the natal horoscopes of stock traders.) The Dow is likely to peak at the first square (90-degree angle from the conjunction) between Mars and Vesta and to bottom at the second trine aspect (240-degree angle from the conjunction). Based on this, you should have bought May 28, 1985, and sold on December 7, 1987. (Ed. Note: October 19, 1987 was Black Monday. December would have been too late in this case.)

The 4 1/2-Year Martian Cycle
According to Lt.Comdr. David Williams, author of Financial Astrology (American Federation of Astrologers), the Mars/Jupiter 4 1/2-year cycle is one of the most dependable market indicators. Mars and Jupiter are in conjunction or opposition every 2.2353 years. Thus, every other conjunction is 4.4706 years, or approximately 234 weeks. Thomas Rieder, author of Astrological Warnings & the Stock Market (Pagurian Press), ties the 4 1/2-year cycle to the synodic period of Mars, The synodic period of a planet is the length of time elapsing between two successive conjunctions of that planet with the Sun as seen from Earth. Mars conjoins the Sun at intervals of about two years and three months, so this cycle is just twice the synodic period of Mars.

 The 4-Year Presidential Cycle
The 3 1/3-, 4.17-, and 4 1/2-year cycles overlap and become what is sometimes referred to as the 4-year presidential cycle. It is theorized that the government stimulates the economy at election time to provide the illusion of prosperity and to insure the re-election of the President. However, closer analysis reveals that the cycle also exists in countries where elections are held every six or eight years or not at all.

Quoted from:
Carol S. Mull - Predicting the Dow.
In: Joan McEvers (Ed. 1989) - Financial Astrology for the 1990s.
 
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Energy Flow Theory & Financial Markets | Al Larson

As planets orbit the sun, they exert tidal forces upon the gases of the sun. These tidal forces cause swirling motions on the sun, creating sun spots, solar flares, coronal holes, and other energy events. All these effects combine to vary the amount of radiation that leaves the sun. That solar radiation is our sole source of energy. We are subject to every fluctuation in it. Solar radiation travels to the earth in two ways: as direct radiation, such as sunshine and radio waves, and as charged particles carried by the solar wind. This flow of charged particles forms a torrent of energy that blasts earth creating a bow wave and a wake, just as a boat going upstream would do. This bow shockwave forms a magnetopause between the earth and the sun. It interacts with the earth’s electromagnetic field, shaping and adding energy to it. At the poles, charged particles follow the magnetic lines of force into our atmosphere. This creates a charged layer called the ionosphere.


As this solar wind passes earth, it shapes our magnetosphere into a teardrop shaped envelope of trapped charged particles. As solar radiation varies so does the earth’s magnetic field, atmospheric ionization, and temperature. Scientists have tracked down a host of relationships between these events and a variety of earthly phenomena such as weather, climate, crime rates, plant growth rates, frequency of thunder storms, blood Ph levels, psychiatric emergencies, and many others.

As part of this activity the solar wind charges our ionosphere to a voltage of approximately +300,000 volts. This charged layer above the earth represents the positive end of a battery. When you stand on the ground you are standing on the negative end of this battery. This is the earth’s electric field that we all live in. When you stand erect, it places a voltage on the top of your head of about 240 volts. That is the same voltage as used by your oven element. Fortunately for us, this is not a high current power source. Otherwise, we would fry.
 
 
 
We are affected by this field. This voltage causes currents to flow through us as we live on earth. These currents are approximately 2000 times as strong as the biological currents that run our brain, our nervous system, our muscles, and our organs. All of our body’s electro-chemical systems are subject to the fluctuations in these currents. The ionosphere and the charges on it form a very dynamic system. Events such as solar flares can cause rapid and large changes in this voltage. Our biological circuits feel these changes. These changes can affect all our biological processes including our emotional moods. Scientific studies have shown that changes in ionization cause people to feel giddy to gloomy. These moods show up in the markets. It is well accepted that markets move in response to fundamental forces and investor psychology. A major finding of my work is that investor psychology is driven by the physical energy system. Those emotional rallies and declines are controlled by the currents that run through us. We call those currents emotions.


[...] I have related the timing and price level of market turns to these currents. I have exhaustively verified every link in this chain of cause and effect. I have developed a solid mathematical knowledge of how this energy flow controls pattern, price, and time in markets. While it is not possible in a chaotic system to make perfect predictions, I have been able to formulate a computer program called XGO which predicts markets with between 60% and 90% accuracy […] This S&P forecast has been running about 80% accurate over the past two months. It was computed over one year ago, and used no price data! It is simply a computation of the energy coming into the S&P. These forecasts can be made for any market, for any time in the future. This is a unique scientific technology.

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Tuesday, June 20, 2023

ICT Daily Range Profiles | Michael J. Huddleston

1. The Classic Buy Day or Sell Day Template
This is the best template to make money since it is a wide range trending day that unfolds mostly on Monday, Tuesday and latest on Wednesday during the London session. The New York session will eventually give a retracement to continue with the trend that was set during the London session. The daily range will last for 7 to 8 hours once the profile is established.
 

Mostly it will give a rally or drop from the daily opening price to the low or high of the day during the London session. The trend usually lasts into 11:00 EST.
 
2. The London Swing to Z Day Template
This template is found in the middle of a larger price swing when the trend is exhausted after a large explosive move. It is a narrow range day and ideally occurs on Thursday. 


Price will initially drop below the opening price, then run above the opening price and go back to the range into consolidation. It first appears to unfold as the Classic Buy or Sell Template. But if it continues consolidating, do not look for continuation into the New York session. Take profits.
 
3. The London Swing to New York Open / London Close Reversal Template
The bullish version of this template always begins like a Classic Buy or Sell template with a decline below the opening price before price starts rallying. Once price drops, a buy entry forms, price rallies to a higher time frame Point of Interest (POI). If this happens during the New York session, it indicates a classic market reversal. 


The template is used to either reach for a bearish order block on a higher time frame, for a turtle soup raid or to close a range. On a bullish day it will first create an initial low of the day during the London session, run up and create the high of the day during the New York session around the London Close, then run back down and clear the initial low that was created during the London session. Ideally it can pan out after the market is in exhaustion based on the higher time frame's dominant trend.
 
4. The Range to New York Open / London Close Rally Template
Generally this template is to be expected on days with high or medium impact news events like interest rate announcements, etc. Ahead of these events price will remain in consolidation during the Asian and London sessions. Lows will be cleared initially and after the news price explodes into a directional move.
 
  
5. The Consolidation Raid on News Release Template
Unfolding during the New York session on days with high impact news, mostly FOMC press releases. During and shortly after the news old highs and lows of prior consolidation levels will be taken out. Ideally buy when a low is taken out and sell when a prior high was breached.
 
 
 6. The London Swing to Seek & Destroy Template
This is the kind of day that won’t make you money. The Market Makers clear intention is to take out both buyers and sellers. Initially it would give you a London Open opportunity and setup, but very likely that won’t come to fruition. The narrow range zig-zag template lasts throughout the New York session and will oftentimes create an inside day. The template is usually applied in the middle or at the end of a larger price swing. 


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L.H. Weston - Gann’s Professor | Hans Hannula

I've been told that Gann was very private about his office. He absolutely forbid anyone from entering it. He wanted to protect his secrets. But one document he kept in his safe. That document was a manuscript by Professor Weston of Washington, D. C. It was written in 1921 (part 1) and 1923 (part 2), four to six years before Gann published his Tunnel Thru the Air, Or Looking Back From 1940, Tunnel Thru the Air contains, in coded form, Gann’s explanation of how to use planetary cycles to trade stocks and commodities. 
 

He told his own family that it was all they ever needed to learn his market secrets. Many Gann students have labored very long and hard (yes, me, too) to decode Gann's writing. Gann loved to write in the abstract style of the Biblical mystics, whom he admired. Much of what is written in the Bible is information about planetary cycles. It is hidden in census counts, symbolic imagery, and heavily coded to escape notice of the casual reader. While one can dig out this material, it takes time, an ephemeris, and a lot of work. Gann had it much easier. What you are about to read is the paper Gann kept in his safe. 
 
Take your time and read it carefully. It’s one of the best papers ever written on the market. 
After you read it, I'll point out some interesting things about it.
 
 
[...] First, this is clearly the foundation of Gann’s use of the 10 year cycle, and its multiples. Second, this is historically a fairly early use of Fourier sequences, and far more mathematical than just using financial astrology. This is no surprise, since it is well known that Gann was a very good mathematician. It is also a source of many of his ideas that market movements follow geometric rules.
 

[...] It is also quite interesting that Weston actually proposed two different versions of the ten year pattern. The first is his computation, using 50 years of data, of a series composed of 20 , 28, 10, and 14 month components, to which he adds a Venus term. In this system he cites use of heliocentric positions. We'll call this first method "Weston’s Curve’.

A most interesting point made in this method is Weston’s discovery that the planetary cycles tend to slip to synchronize with the earth’s annual cycle. I discovered this in my own work, and was sure it was an original discovery. So much for that vanity!

The second method I call “Weston’s Snowflake.” In it he proposes a sequence of turning points in the Jupiter-Saturn cycle that divides it into 10 irregular parts. Interestingly, Weston claims that this is a geocentric system. We'll show in a moment that it was not. But this “false lead” may have been intended for those whom Weston feared would learn his secret. Gann obviously made good use of Weston’s methods.  


[... Weston used] the 0, 18, 54, 90, 126, and 180 degree points of the Jupiter-Saturn cycle as turns. One can quickly see the problem with using this geocentrically. Almost all of the points are triple points, as the earth moves around the sun, giving multiple views from which to measure the angle between Jupiter and Saturn. The problem becomes one of which points to use.

[...] It took only one look at using this rule heliocentrically to convince me that Weston used it that way. Obviously, W. D. Gann watched these outer configurations to be alert for the deviations they might cause in the Jupiter-Saturn cycle. You are advised to do the same.


 
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Friday, June 16, 2023

Financial Markets & Seasonal Geomagnetic Field Variation | Hans Hannula

Any grade-school pupil can tell you when the seasons begin. In the northern hemisphere, generally, spring begins March 21, while summer begins June 21. Autumn begins September 23, and winter begins December 21. Actual dates may vary by one day in a particular year. So step one is simple.

The physical reason behind the seasonal cycle is the tilt of the Earth's axis. The 23.5-degree tilt of the Earth's axis causes more direct heating of the northern hemisphere in the summer, when the Earth tilts toward the sun. It causes less heating in the winter, when the Earth tilts away from the sun. This change in heating and cooling causes the seasonal weather patterns that we are familiar with.
 
Charged particles from the sun form a teardrop-shaped envelope about the globe called the magnetosphere.

Not so well known is the effect of the seasonal variation on the Earth's geomagnetic field. As the sun emits energy, charged particles flow outward, carried by the solar wind. As these particles sweep past Earth, they form a teardrop-shaped envelope around the globe called the magnetosphere.

There is a seasonal variation in two important parts of the magnetosphere. When the Earth tilts toward the sun in the summer, the charged particles can more directly flow into the north pole, where they affect the Earth's magnetic field. This effect is lessened when the Earth tilts away from the sun in the winter.

The second magnetic effect is on the magneto-tail, that part of the magnetosphere which streams away from the sunny side of the Earth. As the Earth tilts toward the sun, this tail "rides higher." As the Earth tilts away from the sun, the tail "rides lower." This affects how our moon, which moves in and out of the magnetosphere, interacts with the Earth's magnetic field.

Australian Government Bureau of Meteorology (2023):
The Seasonal Distribution of Geomagnetic Disturbances.

So what does this have to do with stocks and commodities? Scientific evidence suggests that these fluctuations in the Earth's magnetic field affect humans. Studies show that magnetic field changes are linked to blood PH changes, which in turn cause mood swings. Perhaps the psychological mood swings of traders are also subject to these magnetic field changes.

More obviously, the seasonal cycle could be expected to affect crop prices, such as those of wheat, corn and other commodities. Similarly, with most businesses running on a quarterly profit cycle, seasonal variations in the buying and selling of materials and equipment can be expected. Thus, on both a fundamental and technical basis, a trader can expect season price variations in stocks and commodities.


To perform step 2, mark the dates of the cycle on a chart with solid dots, and place them above or below the price as you estimate that price is high or low relative to what it was approximately one-fourth cycle earlier. Points do not necessarily have to alternate between high and low.

Now look for cycle "inversions." If two lows or highs occur in succession, the cycle has "inverted" between the points. A normal inversion point is halfway through the cycle.

Quoted from:
Hans Hannula (1991) - The Seasonal Cycle. In: Stocks & Commodities V. 9:11 (458-460).
 
 
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Pre-Election Year Seasonal Pattern of U.S. Stock Indexes | Jeffrey A. Hirsch

In 2023 the 15th trading day of June will be Wednesday, 21st - summer solstice.

Reference:
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Sunday, May 28, 2023

Trading the Pump & Dump Pattern | Cameron Benson

I'm going to show you that pattern that I use every single day on every single trade, whether I'm going long or short. The pattern that I'm referring to is the pump & dump and the dump & pump pattern. Every single market movement is either a pump & dump or a dump & pump pattern, and all trade setups are based on these two patterns.
 
 
Markets are fractal, and this pattern is going to occur on the weekly and the daily time frame, on the 4 hour, the 15-minute, the 30 second chart, etc. It doesn't matter: whatever you're looking at, this pattern is going to occur.


I use larger setups and then I start to break things down: I look at the date and day in the month, I look at the three-week cycle, at the three-day cycle, at what day are we in the week, and I look at the weekly range, what is the high and the low of the week. Are we working the low, are we working the high? 
 

Any unidirectional move – up or down - ends with a consolidation, followed by a break in market structure and a continuation to anther pivot level and/or it is followed by a reversal.
 
 
Three pushes to a high, a sideways consolidation, a break in market structure to the downside, then the dump. A lot of times the market will return down at least to the 50% retracement level or down to the level where the pump started or even below.


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Sunday, May 21, 2023

The ‘Khaldun Curve’ | Nima Sanandaji

Ideas change the world. A good example of this is how the global view of taxation quietly began shifting one afternoon in 1974. That afternoon, the American economist Arthur Laffer met with Dick Cheney and Donald Rumsfeld, who both were working for the Nixon-Ford Administration at the time. The topic at hand was taxes, a pressing matter at a time when the highest marginal tax rate in the US was fully 70 per cent.
 

During the meeting, Laffer explained that the relationship between the tax revenues and the tax rate was not as simple as one would expect. Doubling the tax rate, for example, does not double the tax revenues, because higher taxes disincentives people from working. To illustrate his point, Laffer famously sketched a curve on a napkin. It showed that both a tax rate at zero per cent and one at hundred per cent would yield no tax revenues.
 

 
A tax rate of zero per cent would logically mean zero revenues, and one at 100 per cent would disincentives people completely from working, which also means zero revenues. The implication, Laffer noted, is that somewhere between zero and hundred per cent, there is a tipping point. Above this point, raising the tax rates would actually lead to such a damaging effect on economic incentives, that the collected taxes would actually be lower after the tax rate was raised.
 
[...] The funny thing is that Arthur Laffer’s theory was far from new. He was rediscovering a concept that had been acknowledged during the Islamic Golden Age period of free market policy. Laffer has himself explained that he didn’t invent the curve, but took it from Ibn Khaldun, a 14th-century Muslim, North African philosopher. Indeed, many of the ideas we today associate with Western free-market thinkers originated in the Islamic world.

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Thursday, April 27, 2023

The 3 Day Cycle | Cameron Benson

 
 
The 3 Day Cycle  is a recurring market cycle, that when identified, can be the groundwork of a trade setup. It consists of 3 days, and begins with a false break at the current weeks high or low. In his Best Trade Setups Playbook Stacey Burke described the 3 Day Cycle setups as either pump and dumps, or dump and pumps: "They [the market makers] pump, pump, pump, go sideways and drop a bit, one more small pump, then a dump. The dump can go straight down, fast. The pump up, may often be hard to trade on the first day, the price action can be choppy, and back and forth, a slow grinding auction. Other times, you are forced to "chase the move."  

 
Finding Day 1:
Look for a false break above or below a previous day's high or low AT THE HIGH OR LOW OF THE WEEK.

Attributes of Day 1:
1. Breaks Below/Above Previous Days High or Low at the high of the week, and the day closes back inside of previous days range.
a. Sub Variation: Breaks through previous days level and days closes above/below that level. 
The following day, price comes back inside of the the range from 2 days ago and closes.
2. Can become a First Green Day or First Red Day (Signal for following day).
3. Day 3 sometimes turns into Day 1 at the close of the day.

 
 
 Attributes of Day 2 of the 3 Day Cycle:

Day 2 can be either
1. Continuation in direction of false break; or:
2. It can turn into ...
    a.) a First Red Day (FGD)
    b.) a First Green Day (FRD)
    c.) an Inside Day
    d.) a Trend Day

Areas of Interest:
1. High of the Day/Low of the Day (HOD/LOD)
2. High of the Session/Low of the Session (HOS/LOS)
3. Outside Day/Inside Day (Was there a false break?) (Act as Support/Resistance)
4. Low Bear/High Bull (Support/Resistance)

Day 2 Trade Setups:
- Long/Short Squeeze
- Parabolic Trend Trade
- High of the Session/Low of the Session (HOD/LOD) Trade
- High of the Day/Low of the Day (HOD/LOD)
- Low Hanging Fruit (LHF) Continuation (Trend Trade)

Method:
1. Support/Resistance References:
a. Low Bear/High Bull
b. Previous Days High/Low
c. HOD/LOD
2. Measure 3 Levels of rise/fall from Low/High of day for potential strike zone.
3. Use Support/Resistance References as additional confluence.
 
 
Attributes of Day 3 of the 3 Day Cycle:

1. Day 3 is the last day of the 3 Day Cycle.
2. A lot of times Day 3 can turn into Day 1, either on the current day or the next day 
(Reset of the Day Count).
3. Day 3 can either become a blow off trend continuation day (in the direction of the trend) or a reversal day.

Trade Setups:
1. Parabolic/Capitulation Trend
2. Reversal HOW/LOW
3. LHF Continuation (Trend Trade)

Areas of Interest:
1. Low/High of week
2. Previous Days High/Low (Support/Resistance/Trapped Volume)
3. High/Low of Day
4. High Bull/Low Bear (Support/Resistance)
5. OD/ID (Outside Day/Inside Day)

Reference:
 
 
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