A look back at 2008 in terms of cycle analysis.
Cycle Analysis 2008 (Emini weekly)
The weekly Emini chart above shows the major turning points:
- The Emini peaked with "End of Trend" signal in October 2007 – end of up trend.
- The next cyclical low was broken in January 2008 – start of down trend.
- The next cyclical high in May 2008 was a test of the January highs.
- The next cyclical low in July 2008 held for a while but was eventually broken in September 2008 – down trend continuation.
As you can see, trend moves develop out of cyclical turning points that do not hold.
Cycle Analysis 2009 (S&P500 Index monthly)
As for 2009, for me the most important chart is the monthly chart – where a cyclical low is approaching. These don’t come along too frequently and so their importance is heightened. A cyclical low will be confirmed when December’s high (918.75) is broken.
Good luck with your Emini trading in the New Year.