CYCLE PRINCIPLES:
1. The Principle of Commonality – Markets(Index) and security price(stocks) movements have many elements in common. In particular they tend to have common high and low points that coincide with cycles.
2. The Principle of Cyclicality – Price movements correspond to a combination of waves that exhibit cyclic characteristics.
3. The Principle of Summation – Cycle waves of different degrees combine to affect price movement and do so by adding the waves together.
4. The Principle of Harmonicity – Cycle waves of different degrees are harmonized and are related by a small integer value.comaan harmoics are 2nd and 3rd or 1/2 and 1/3.
5. The Principle of Synchronicity – Cycle waves are phased and synchronized at price troughs.
6. The Principle of Proportionality – Waves in price movement have amplitude that is proportional to their wavelength.
7. The Principle of Nominality – A specific, nominal collection of harmonically related waves is common to all price movements.
8. The Principle of Variation – Variation in harmonicity, synchronicity, proportionality and nominality (previous 4 principles) is expected.
FOLLOWING CYCLES ARE SHOWN HERE:
Cycle with second harmonic has given mid cycle dip where as cycle with 3rd harmonic has given higher peak there by confirming presence of cycle through sine wave like price strucutre.
270 DAYS:WHITE(WORKING IN 3RD HARMONIC,meaning it is divided in 3 equal length cycle of 90 days each)
90 DAYS:PINK(WORKING IN 2ND HARMONIC,meaning it is divided in 2 equal length cycle of 45 days each)
45 DAYS:GREEN(WORKING IN 3RD HARMONIC,meaning it is divided in 2 equal length cycle of 15 days each)
15 DAYS:YELLOW(WORKING IN 2ND HARMONIC,NOT SHOWN HERE)
Above mentioned things represents first 5 Principle of cycle theory,as we can see price movement having cyclic characteristics and higher degree cycle being divided in it's 2nd or 3rd harmonics,there by forming lows/troughs together.If we do summation of lower degree cycles then we get higher degree cycle which is representing principle of summation.
OBSERVATIONS:
#CURRENT PHASE OF CYCLE:
270 DAYS:BEARISH
90 DAYS:BEARISH
45 DAYS:BULLISH
15 DAYS:BULLISH
#Briefings of 270 DAYS CYCLE:
In the current 270 days cycle with 3rd harmonic,we have already seen 3/4th cycle high around 39360,there by suggesting us that 270 days cycle has completely turned bearish
#Briefings of 90 DAYS CYCLE:
Rise from 8th march in current 90 days cycle can be attributed 90 day cycle's 2nd harmonic cycle working in bullish phase,post mid-cycle dip @32155.Chances of this current rise to cross highest high of current 90 day cycle(39424) is very low as current 90 day cycle itself has turned negative or bearish
#Briefings of 45 DAYS CYCLE:
As it is working in it's 3rd harmonic meaning current 45 day cycle will have three 15 day's cycle or will be divided in three 15 days cycle.Currently 1st 15 day cycle is going on and it has reached it's halfway point meaning going ahead we can see one dip around 28-30 th march which will complete first 15 day cycle,from there we can again see prices pushing higher in order to make 45 day's mid-cycle high,this high can be higher then high registered in first 15 day cycle and around 22 april second 15 day cycle will end meaning a dip in price around 20-22 nd april,this will be followed by last 15 day cycle rise post where in we will see price unable to cross high posted in second 15 day cycle there by turning every cycle(15,45,90,270) negative.
13th May is the day when entire current 270 day cycle is ending meaning in 2nd-3rd week of may we can see bank nifty forming important low.
Analysis:
Scenario-1:Bearish/Road-blocks ahead for prices to move higher from current levels
1)FLD(136 days) @ 36436.
2)61.8% retracement from high to low of previous 45 day cycle @ 36647.
3)Ichimoku cloud @ 36428.
4)Falling OI in futures contract from last 6 days.
5)Higher degree cycle(270 and 90) has already turned negative indicating lower probability of making new high till 13th may.
6)We have seen prices breaching previous 90 day cycle low in current 90 day cycle again indicating selling pressure.
Personal view:
As bigger cycle has turned negative buying from current levels should be avoided and long positions should be protected with stop-loss as per once risk appetite.I feel post 12th April(2nd ,15 day cycle peak zone starts of current 45 day cycle)we can see decent selling pressure in Bank nifty as post 12th April all the major cycle's will turn negative.
Disclaimer:Analysis/views shown here are only for educational purpose.Trading position should not be taken on its basis.
1. The Principle of Commonality – Markets(Index) and security price(stocks) movements have many elements in common. In particular they tend to have common high and low points that coincide with cycles.
2. The Principle of Cyclicality – Price movements correspond to a combination of waves that exhibit cyclic characteristics.
3. The Principle of Summation – Cycle waves of different degrees combine to affect price movement and do so by adding the waves together.
4. The Principle of Harmonicity – Cycle waves of different degrees are harmonized and are related by a small integer value.comaan harmoics are 2nd and 3rd or 1/2 and 1/3.
5. The Principle of Synchronicity – Cycle waves are phased and synchronized at price troughs.
6. The Principle of Proportionality – Waves in price movement have amplitude that is proportional to their wavelength.
7. The Principle of Nominality – A specific, nominal collection of harmonically related waves is common to all price movements.
8. The Principle of Variation – Variation in harmonicity, synchronicity, proportionality and nominality (previous 4 principles) is expected.
FOLLOWING CYCLES ARE SHOWN HERE:
Cycle with second harmonic has given mid cycle dip where as cycle with 3rd harmonic has given higher peak there by confirming presence of cycle through sine wave like price strucutre.
270 DAYS:WHITE(WORKING IN 3RD HARMONIC,meaning it is divided in 3 equal length cycle of 90 days each)
90 DAYS:PINK(WORKING IN 2ND HARMONIC,meaning it is divided in 2 equal length cycle of 45 days each)
45 DAYS:GREEN(WORKING IN 3RD HARMONIC,meaning it is divided in 2 equal length cycle of 15 days each)
15 DAYS:YELLOW(WORKING IN 2ND HARMONIC,NOT SHOWN HERE)
Above mentioned things represents first 5 Principle of cycle theory,as we can see price movement having cyclic characteristics and higher degree cycle being divided in it's 2nd or 3rd harmonics,there by forming lows/troughs together.If we do summation of lower degree cycles then we get higher degree cycle which is representing principle of summation.
OBSERVATIONS:
#CURRENT PHASE OF CYCLE:
270 DAYS:BEARISH
90 DAYS:BEARISH
45 DAYS:BULLISH
15 DAYS:BULLISH
#Briefings of 270 DAYS CYCLE:
In the current 270 days cycle with 3rd harmonic,we have already seen 3/4th cycle high around 39360,there by suggesting us that 270 days cycle has completely turned bearish
#Briefings of 90 DAYS CYCLE:
Rise from 8th march in current 90 days cycle can be attributed 90 day cycle's 2nd harmonic cycle working in bullish phase,post mid-cycle dip @32155.Chances of this current rise to cross highest high of current 90 day cycle(39424) is very low as current 90 day cycle itself has turned negative or bearish
#Briefings of 45 DAYS CYCLE:
As it is working in it's 3rd harmonic meaning current 45 day cycle will have three 15 day's cycle or will be divided in three 15 days cycle.Currently 1st 15 day cycle is going on and it has reached it's halfway point meaning going ahead we can see one dip around 28-30 th march which will complete first 15 day cycle,from there we can again see prices pushing higher in order to make 45 day's mid-cycle high,this high can be higher then high registered in first 15 day cycle and around 22 april second 15 day cycle will end meaning a dip in price around 20-22 nd april,this will be followed by last 15 day cycle rise post where in we will see price unable to cross high posted in second 15 day cycle there by turning every cycle(15,45,90,270) negative.
13th May is the day when entire current 270 day cycle is ending meaning in 2nd-3rd week of may we can see bank nifty forming important low.
Analysis:
Scenario-1:Bearish/Road-blocks ahead for prices to move higher from current levels
1)FLD(136 days) @ 36436.
2)61.8% retracement from high to low of previous 45 day cycle @ 36647.
3)Ichimoku cloud @ 36428.
4)Falling OI in futures contract from last 6 days.
5)Higher degree cycle(270 and 90) has already turned negative indicating lower probability of making new high till 13th may.
6)We have seen prices breaching previous 90 day cycle low in current 90 day cycle again indicating selling pressure.
Personal view:
As bigger cycle has turned negative buying from current levels should be avoided and long positions should be protected with stop-loss as per once risk appetite.I feel post 12th April(2nd ,15 day cycle peak zone starts of current 45 day cycle)we can see decent selling pressure in Bank nifty as post 12th April all the major cycle's will turn negative.
Disclaimer:Analysis/views shown here are only for educational purpose.Trading position should not be taken on its basis.
If we see a close below previous day's low along with close below raising channel shown then we can assume top for current 15 day cycle has been formed.