Understanding the actual application and the true meaning of Cycle Timing
As the world’s situation (geopolitical conflicts, government’s policies and intervention, human sentiments (mass psychology) may change, Cycle (wave length and amplitude) occasionally may contract, expand and even invert. It actually means bull cycle or bear cycle (Cycle high or low) may come earlier or delayed. Occasionally, the anticipated Cycle low may become Cycle high or vice versa. Example, expected Gold major low around April 2016 could happen (extended to) in April 2017. In price, expected major low in April could become a Cycle high if the Cycle wave length is extended.
I don’t mean that it must happen and fortunately enough, with the given reliable data and accurate analysis, the frequency of forecasts change is very low and if we do need to adjust it, we should be able to see ahead (at least in weeks) whether the Cycle behaviour is going to change.
However to produce and maintain consistent top/accurate forecasts, it is critically important to monitor and adjust (if warranted). A lot of hard works and time are needed to do regular updates (at least weekly) which are essential to keep us on the right track with the events of the possible Cycle trend change. That is why, I strongly suggest you subscribe Premium Newsletter to update yourself (at least weekly) and to make sure you won’t miss the Bull Cycle (if you Buy Long) and the Bear Cycle (if you short)
Over the years, I used 7 Cycle Timing Methodologies to identify the turning points and one of the methods is W.D. Gann’s mater time factor
W.D. Gann taught that the best way to predict the future is to have an understanding of the past. W.D. Gann who had more than 50 years of experience in financial markets and did research dating back hundreds of years. What he found to his satisfaction was that history repeats, and the past is the best predictor of future prices. His forecasts of time cycles over a half century proved to be accurate because those cycles are based on human nature, which does not change.
W.D GANN MASTER TIME FACTOR
W.D. Gann, attained legendary status as a “Guru of Wall Street” between 1900 and 1955.
He demonstrated an uncanny ability to forecast major market turning points. His forecast of the 1929 bull market top in the stock market nine months before the high is a matter of record, having been published in his yearly forecast for 1929. Probably, he could have made about $2 billion in today’s money.
Let’s review some of his methodology “Master Time Factor” taught to all of us.
Gann’s MASTER TIME FACTOR
“By a study of the time cycles you will learn why tops and bottoms are formed at certain times. Everything moves in cycles as a result of the natural law of action and reaction. By a study of the past, I have discovered what cycles repeat in the future. In order to be accurate in forecasting the future, you must know the major cycles. The most money is made when fast moves and extreme fluctuations occur at the end of major cycles. I have experimented and compared past markets in order to locate the major and minor cycles and determine in what years the cycles repeat in the future.”
The law of vibration enabled me to accurately determine the exact points to which stocks and commodities should rise and fall. By studying time cycles, you will learn why tops and bottoms are formed at certain times. In order to be accurate we must know the major cycles. Always consider the annual forecast and whether the big time limit has run out before judging a reverse move.
Everything moves in cycles as a result of natural law of action and reaction. The cause can be determined years in advance. The future is but a repetition of the past, as the Bible plainly states, “the thing that hath been, it is that which shall be; and that which is done, is that which shall be done, and there is no new thing under the sun.” (Ecclesiastes. 1:9). By a study of the past, I have discovered what cycles repeat in the future. In order to be accurate in forecasting the future, you must know the major cycles. The most money is made when fast moves and extreme fluctuations occur at the end of major cycles. I have experimented and compared past markets in order to locate the major and minor cycles and determine in what years the cycles repeat in the future.
Time is the most important factor in determining market movements because the future is a repetition of the past and each market movement is working out time in relation to some previous Time Cycle.
Gann referred to the “Great Cycle – Master Time Period – 60-Years the 49-50 Year Cycle, and the 30 Year Cycle (see chapter #12).
Great Cycle – Master Time Period – 60 Years: “This is the greatest and most important cycle of all, which repeats every 60 years or at the end of the third 20-Year Cycle. You will see the importance of this by referring to the war period from 1861 to 1869 and the panic following 1869: also 60 years later – 1921 to 1929 – the greatest bull market in history and the greatest panic in history followed. This proves the accuracy and value of this great time period.”
45-Year Cycle: “The digits 1 to 9 when added together total 45. 45 is the most important angle. Therefore 45 years in time is a very important cycle. One-half of 45 is 22 ½ years or 270 months. One-fourth of 45 is 11 ½ years or 135 months, which is three times 45. You will note how important these points are on the 360 degree Circle Chart.”
30-Year Cycle: “The 30-Year Cycle is very important because it is one-half of the 60-year cycle or Great Cycle and contains three 10-year cycles. In making up an annual forecast you should always make a comparison with the record 30 years back.”
20-Year Cycle: “One of the most important Time Cycle is the 20-year cycle or 240 months. Most stocks and the averages work closer to this cycle than to any other. Refer to analysis of the “20-Year Forecasting Chart.”
84-Year Cycle: “This repeated 84 years from 1845 to 1852 and brought low prices in 1929 to 1933.” The 84-Year Cycle alerts us to be prepared for low prices 84-Years from 1929 to 1933. The 84-Year Cycle projects low prices in 2013 to 2017.
W.D. Gann also observed what he came to call “the decade cycle”. In his many commodity and stock market courses, he described the decade cycle this way: By studying the yearly high and low chart and going back over a long period of time, you will see the years in which bull markets culminate and the years in which bear markets begin and end. Each decade, or 10-year cycle, which is one-tenth of 100 years, marks an important campaign… In referring to these numbers and these years, we mean the calendar years. To understand this, study 1891 to 1900, 1901 to 1910, 1911 to 1920, 1921 to 1930 and 1931 to 1939. The ten year cycle continues to repeat over and over, but the greatest advances and declines occur at the end of the 20-year and 30year cycles, and again at the end of the 50-year and 60-year cycles, which are stronger than the others.
1. A year in which a bear market ends and a bull market begins. 1901, 1911, 1921.
2. The second year is a year of a minor bull market, or a rally in a bear market will start at some time. 1902, 1912, 1922, 1932.
3. Starts a bear year, but the rally from the second year may run to March or April before culmination, or a decline from the 2nd year may run down and make bottom in February or March, like 1933. 1903, 1913, 1923.
4. The fourth year is a bear year, but ends the bear cycle and lays the foundation for a bull market. Compare 1904, 1914.
5. The fifth year is the year of Ascension, and a very strong year for a bull market. See 1905, 1915, 1925, 1935.
6. The sixth year is a bull year, in which a bull campaign which started in the fourth year ends in the Fall of the year and a fast decline starts. See 1896, 1906, 1916, 1926.
7. Seven is a bear number and the seventh year is a bear year because 84 months or 840 degrees is 7/8ths of 90. See 1897, 1907, 1917, but note 1927 was the end of a 60 year cycle, so not much of a decline.
8. The eighth year is a bull year. Prices start advancing in the 7th year and reach the 90th month in the 8th year. This is very strong and a big advance usually takes place. Review 1898, 1908, 1918, 1928. (2008 did not follow this pattern, which is where a little real estate cycle knowledge was helpful in this instance.)
9. Nine is the highest digit and the ninth year is the strongest of all for the bull markets. Final bull campaigns culminate in this year after extreme advances and prices start to decline. Bear markets usually start in September to November at the end of the 9th year and a sharp decline takes place. See 1869, 1879, 1889, 1899, 1909, 1919 and 1929, the year of the greatest advances, culminating in the fall of that year, followed by a sharp decline.
10. Ten is a bear year. A rally often runs until March and April; then a severe decline runs to November and December, when a new cycle begins and another rally starts. See 1910, 1920, 1930.