XL-entLady
Well-known member
Malyla, I enjoy your finds. Thanks for sharing them with us! Just keep on keepin' the good stuff and sweep the rest out with the trash. :cheesy:
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Business Cycle Buy & Hold Strategy
- Thread starter malyla
- Start date
alevin
Well-known member
http://www.[[financialsense.com/fsu/editorials/2009/0430.html
Fibonacci Nightmare
by Walter Roman | April 30, 2009
Print
Hmm, tuck and roll would seem to be in order somehow. Or is it "Dive, dive, dive"?
Fibonacci Nightmare
by Walter Roman | April 30, 2009
Hmm, tuck and roll would seem to be in order somehow. Or is it "Dive, dive, dive"?
alevin
Well-known member
I actually am more inclined that way myself, which is why I did a tucknroll this am on a screaming divvy commodity stock-sold some (so I could recycle into another value commod stock), left some on the table (to collect divvy's this month). My non-TSP brokerage investments at the moment are all commodity divvy stocks, ETFs. Workin' on moving my stock IRA mutual funds over into brokerage so I can do some more of just what you said. Fib cycles notwithstanding.
the post is just another piece of information for people to consider risk-wise.
the post is just another piece of information for people to consider risk-wise.
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Bullitt
Well-known member
Malyla, thanks for the link. I agree that this writer has potential if he could manage to put it together, especially in citing better references. I found this to be an informative read.
However, there are two sides to every story and I find many of his accusations questionable. He never does tell us exactly why he's locked up and uses the term CIA as if it's in reference to a local police department. In many ways this author reminds me of a drug dealer/smuggler who just got busted and spills his guts in order to make everyone believe that he's been wrongfully accused or is just merely a spoke on the wheel while there are much bigger fish to fry. I have yet to meet a 'guilty' person in a prison.
However, there are two sides to every story and I find many of his accusations questionable. He never does tell us exactly why he's locked up and uses the term CIA as if it's in reference to a local police department. In many ways this author reminds me of a drug dealer/smuggler who just got busted and spills his guts in order to make everyone believe that he's been wrongfully accused or is just merely a spoke on the wheel while there are much bigger fish to fry. I have yet to meet a 'guilty' person in a prison.
malyla
Active member
Just back for a quick observation (I'm buried in research papers and need a break).
I was lurking around and read Coolhand's thread (usually the first thread I click on) when he directed me to the Fearless Forecasters message board and a post with TA analysis that uses planets and number analysis but also uses an analysis performed by timingsolutions.com that convolves two cycles called the Jugler and Kitchen cycles to get a cycle that looks very much like Armstrong's 8.6 year business cycle. I include the picture of the convolved cycles from that post here. Does anyone have information on what these two cycles are, why they are convolved, and how the initial conditions are determined? Seems interesting that the shape is the same, but the dates are different. However, to be fair, Armstrong's cycle could just be curve fitting (I still have problems with some of his explanations and how he picked his initial conditions, although, 2003 and 2007 where amazingly accurate.
Anywho... just curious if anyone on the mb uses this or has research it.
I was lurking around and read Coolhand's thread (usually the first thread I click on) when he directed me to the Fearless Forecasters message board and a post with TA analysis that uses planets and number analysis but also uses an analysis performed by timingsolutions.com that convolves two cycles called the Jugler and Kitchen cycles to get a cycle that looks very much like Armstrong's 8.6 year business cycle. I include the picture of the convolved cycles from that post here. Does anyone have information on what these two cycles are, why they are convolved, and how the initial conditions are determined? Seems interesting that the shape is the same, but the dates are different. However, to be fair, Armstrong's cycle could just be curve fitting (I still have problems with some of his explanations and how he picked his initial conditions, although, 2003 and 2007 where amazingly accurate.
Anywho... just curious if anyone on the mb uses this or has research it.
malyla
Active member
The original 8.6yr business cycle plot plotted by Tom a few years ago can be found here http://www.tsptalk.com/mb/showpost.php?p=218137&postcount=436
Did you have a link to the page where that chart can be found? The attachment is a little tough to read. Thanks!
malyla
Active member
Coolhand posted the link - I've copied it here. It's halfway down the post after the astrological analysis.
http://www.traders-talk.com/mb2/index.php?showtopic=110073
malyla
Active member
No worries. However, the chart above the chart you posted was the one that most resembled the 8.6yr business cycle. The chart you posted has some other applets used on it to more closely match real market fluctuations. Both charts are very interesting in that we can trend them as the time goes on and see if these cycle theories continue into the future market trends.
This analysis reminds me of the work that Trader Fred does. Has he heard of Juglar and Kitchen cycles?
Thanks - I haven't figured out how to get the pictures to post in the post. Should really be working anyway:embarrest:
malyla
Active member
Thanks Tom. Could you also post the picture of the 8.6yr Business Cycle chart into the post (#27) that follows the one you already fixed. I just put the link that Mojo set up, but it would be more educational to see the pictures of the two close together.
Thanks again.
malyla
Active member
Just back for a quick observation (I'm buried in research papers and need a break).
I was lurking around and read Coolhand's thread (usually the first thread I click on) when he directed me to the Fearless Forecasters message board and a post with TA analysis that uses planets and number analysis but also uses an analysis performed by timingsolutions.com that convolves two cycles called the Jugler and Kitchen cycles to get a cycle that looks very much like Armstrong's 8.6 year business cycle. I include the picture of the convolved cycles from that post here. Does anyone have information on what these two cycles are, why they are convolved, and how the initial conditions are determined? Seems interesting that the shape is the same, but the dates are different. However, to be fair, Armstrong's cycle could just be curve fitting (I still have problems with some of his explanations and how he picked his initial conditions, although, 2003 and 2007 where amazingly accurate.
Anywho... just curious if anyone on the mb uses this or has research it.
Using the convolving of the Juglar and Kitchen cycles we get a 10+ year cycle which is centered on this past 2 years in the market. Still seems like curve fitting.
malyla
Active member
The latest from Armstrong. A New Yorker article Oct 12, 2009.
http://www.contrahour.com/contrahour/
or
http://www.scribd.com/doc/20783434/cyclesnewyorker101209
ABSTRACT: ANNALS OF FINANCE about Martin Armstrong, cycle theory, and the financial markets. One day, in a newspaper, the young Martin Armstrong came across a list of financial panics between 1683 and 1907. He found that, on average, there had been a panic every 8.6 years. As he read more, he began to suspect that 8.6 was a highly significant number. In the early seventies, Armstrong became a trader and dealer in gold, and began compiling forecasts about commodities and currencies, which he sent out to clients. Over time, forecasting became his business. He constructed what he called an Economic Confidence Model, which he relied on to predict an upturn in the price of commodities in the early days of 1977. It worked. Later, he realized that 8.6 years was exactly three thousand one hundred and forty-one days: 3,141, the number pi times a thousand. If pi was essential to the physical world, perhaps it somehow governed the markets. Pi suggested some future dates of significance, which Armstrong watched carefully as they approached: December, 1989, which marked the Nikkei’s peak before it crashed; July, 1998, the high point in the S & P, just before a Russian default broke the giant hedge fund Long Term Capital management. In 1999, Armstrong published a report explaining the part pi had played in his calculations. That year, he was charged with defrauding Japanese investors of billions of dollars. Armstrong has now spent more than nine years in jail. Discusses the differences between fundamental analysis and technical analysis of the financial markets. Cycle theory is a kind of Gnostic offshoot of technical analysis. Mentions other thinkers who have studied cycles and market timing, including Nikolai Kondratiev, Joseph Schumpeter, Bill Erman, and Arch Crawford. The writer was told repeatedly that some of the biggest investors out there view even the wackier cycle theories with respect. Tells about Edward R. Dewey, a cycle theorist who was the chief economic analyst for the Department of Commerce under Herbert Hoover. In the forties, he formed the Foundation for the Study of Cycles, which endeavored to collect and process as much cycle data as possible. Discusses Fibonacci and the idea that such phenomena as the spirals in the nautilus shells, hurricanes, and galaxies; branches of trees, leaf veins, skeletal and circulatory systems; and the distribution of flower petals and brain waves conform to something called the golden ratio. Also mentions the theories of Ralph Nelson Elliott and Robert Prechter. Tells about Armstrong’s arrest and gives details of the criminal case against him. Writer visits Armstrong at the low-security prison camp on the Fort Dix military base where he is being held.
http://www.contrahour.com/contrahour/
or
http://www.scribd.com/doc/20783434/cyclesnewyorker101209
ABSTRACT: ANNALS OF FINANCE about Martin Armstrong, cycle theory, and the financial markets. One day, in a newspaper, the young Martin Armstrong came across a list of financial panics between 1683 and 1907. He found that, on average, there had been a panic every 8.6 years. As he read more, he began to suspect that 8.6 was a highly significant number. In the early seventies, Armstrong became a trader and dealer in gold, and began compiling forecasts about commodities and currencies, which he sent out to clients. Over time, forecasting became his business. He constructed what he called an Economic Confidence Model, which he relied on to predict an upturn in the price of commodities in the early days of 1977. It worked. Later, he realized that 8.6 years was exactly three thousand one hundred and forty-one days: 3,141, the number pi times a thousand. If pi was essential to the physical world, perhaps it somehow governed the markets. Pi suggested some future dates of significance, which Armstrong watched carefully as they approached: December, 1989, which marked the Nikkei’s peak before it crashed; July, 1998, the high point in the S & P, just before a Russian default broke the giant hedge fund Long Term Capital management. In 1999, Armstrong published a report explaining the part pi had played in his calculations. That year, he was charged with defrauding Japanese investors of billions of dollars. Armstrong has now spent more than nine years in jail. Discusses the differences between fundamental analysis and technical analysis of the financial markets. Cycle theory is a kind of Gnostic offshoot of technical analysis. Mentions other thinkers who have studied cycles and market timing, including Nikolai Kondratiev, Joseph Schumpeter, Bill Erman, and Arch Crawford. The writer was told repeatedly that some of the biggest investors out there view even the wackier cycle theories with respect. Tells about Edward R. Dewey, a cycle theorist who was the chief economic analyst for the Department of Commerce under Herbert Hoover. In the forties, he formed the Foundation for the Study of Cycles, which endeavored to collect and process as much cycle data as possible. Discusses Fibonacci and the idea that such phenomena as the spirals in the nautilus shells, hurricanes, and galaxies; branches of trees, leaf veins, skeletal and circulatory systems; and the distribution of flower petals and brain waves conform to something called the golden ratio. Also mentions the theories of Ralph Nelson Elliott and Robert Prechter. Tells about Armstrong’s arrest and gives details of the criminal case against him. Writer visits Armstrong at the low-security prison camp on the Fort Dix military base where he is being held.
malyla
Active member
Thanks Tsunami for that link. It's always interesting to see what Armstrong is up to. Other cycles also show a top in July 2010 with a low in 2012. I'm still hoping that the low will come earlier as Armstrong predicted (June 2011) so I can move into stocks long term.
alevin
Well-known member
Question is, how low will it go and how long will it stay low? I'm seeing other people talking 2015-16 the past couple days too. I saw something last night about a 60 year bear market-didn't have the heart to read it.
will look around for it this morning before I go to work. I hope it sounds like tin foil. If not, all we can do is the best we can do and live day to day grateful for the small things. which we could be doing anyway.
will look around for it this morning before I go to work. I hope it sounds like tin foil. If not, all we can do is the best we can do and live day to day grateful for the small things. which we could be doing anyway.
CountryBoy
Well-known member
Get and stay outta debt and pay cash for everything you can, is about the best strategy now. And save as much as possible and try to diversify those savings.
malyla
Active member
Well, looking at the two plots above, we get the following:
The Juglar and Kitchen cycles are predicting a down wave in the monthly stocks until May 2012; and Armstrong's wave count was off by a year for the secondary up wave in March 2008 (it really started in March 2009), but if it's just a registration error in the date, then his down wave will take us into May 2012.
There are too many similarities between the business cycle and the stock market for me to discount it right now. Back testing of the Biz_Cyc B&H method (100% F in bear markets and 100% I in bull markets as determined by the business cycle) shows a VERY good correlation with a 1200% return since Sept 1991. This compares to a B&H in stocks (40% C, 30% S, 30% I) of 400% since Sept 1991. Avoiding the Bear hits to your portfolio is the key to good long term returns. Amazingly, the LMBF method has returned 500% since Sept 1991 which is better than a straight B&H of stocks mainly because it does avoid losses in an extended bear market.
Time will tell. Still playing it cautious for now and if Armstrong's cycle proves to be off by a year, I will not be going into equities on June 2011, but will wait until June 2012.
I may try to trade, but every time I do, I lose, so maybe not.:notrust:
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