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These clusters are precise though they appear somewhat anomalous to the those on the preceding page. The chief difference here is the central cluster--which it is--a cluster of two outposts occurring within two weeks of each other.
The boxes at the bottom of the outposts
show the length of time between prices and the outposts in clusters. The left projecting boxes show the time lag from peak price to the first outpost in each cluster. They range from two years in 1937-1939 to 17 months in 1973-1974, and nearly two years (22 months) from the 2007 price peak to the first outpost in 2009.
The boxes projecting to the right show the time from the last outpost in each cluster to its following low in prices. The solid brown box is a projection of the time range for the forthcoming low in prices for the expected episode. The probable range is July 28, 2010 to September 26, 2012, two to four years from today.
Will that happen? No one knows, including me. But the history of these episodes has legs.The timing characteristics are impressively consistent with each other. See here (shows those pairs of historic price behavior relevant to today).
Cycles are easily proven. Just hop up on the patient's table and get your electrocardiogram taken. Look at the resulting picture: humps, spikes, dives, recoveries, runs ... repeat ... pulsing with life: a perfect analog to the chart above. Tides around the world change about every six hours and are highly predictable. Not to mention day and night, summer and winter, spots on the sun and myriad other biological and physical phenomena.
The stock market is a pyschologram which
outpictures the cyclic flow of collective human emotions in summary form. The palette runs from panic to euphoria and back again, with all the nuances in between.
Conclusion. The market has entered a period of long-term downward bias. The chart is a picture of 4,400 Monday mornings. Their cycles provide a hint of where they may be going next.
Caveats. Too few observations for statistical probity (an oxymoron?). But that's always the problem with long cycles. And once you get a handle on, say, the 36-year cycle, and it misbehaves, you conclude that suggests evidence of a bigger, longer cycle(s), not yet accounted for, coming in and trumping the runts, twisting their carefully calculated expectancies even to the point of upside-downess.
Sources
Worden Brothers TC2007,
Swiss Ephemeris,
'Copernicus'
Posted
8/17/2008 12:30 p.m. EDT
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