Saturday, June 14, 2008

Fibonacci Gann Cycles and Stock market bottoms

A good friend of mine provided the four major dates for market bottoms in 2008. These dates are listed according to the Fibonacci Gann cycles.
The dates for 2008 are - Jan 28, Mar 20, Jun 18 and Nov 18.

I took these dates and did some analysis to understand the correlation to US stock market indexes. I used DJIA and S&P 500 as references.

The January major stock bottom was on Jan 22
The March stock bottom was on March 17.

Jan 22 to Jan 28= difference was 5 market days
Mar 17 to Mar 20= difference was 4 market days

So, for this market cycle on Jun 18, the low would be:
3 market days= June 16
4 market days= June 13
5 market days= June 12

June 13, is out of question as we had an UP day.
June 12 and June 16 are left
So, the question that remains is if the low we had on June 12 - if that can be considered as the cycle low. Or if the market closes up on Jun 16, then we can conclude from this CYCLE perspective that the low has been set for the markets till Nov 18.

So, that means no more shorts from here on..only longs. Let us keep a close eye and check if the June 12 low is taken out before Nov.

I really believe in these cycles. I also follow this guy called Charles Nenner. Listed some of his predictions over here.

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