Ripples in Time - Cycle Analysis of the S&P 500

By: Ron Griess | Tue, Feb 15, 2005
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This analysis was originally published by The Chart Store on January 9, 2005. The charts have been updated through February 11, 2005.

Among the many books/papers in our investment library is a collection of writings by George Lindsay. One of Mr. Lindsay's techniques was to look for mirror patterns in price action. In this Observation we apply that technique to the unfolding time cycles of the S&P 500.

We begin with a simple weekly bar chart of the S&P 500.

Our first step is to find some important pivot points which we have circled in the following chart.

We apply some labels to the process.

Now the fun part begins. If we count time intervals with the week of the pivot point being 0, an interesting pattern develops.

Chart Notes:

One pattern that many market technicians have been talking about is an inverted head and shoulders pattern. We have added lines to the following chart which represent our interpretation of that possibility.

To complete the picture, we have added two ovals to our last chart to point out where we are in relationship to the overall pattern. If the market is "reflecting" the past, a correction of several weeks is in order. Points 2 and 1 looking forward are September 25, 2005 and March 10, 2006, respectively.

Summary Points:


 

Ron Griess

Author: Ron Griess

Ron Griess, Proprietor
The Chart Store

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