Time Cycle analysis SP500

2023년 1월 2일

I'm in the camp that believes the S&P500 is in a megabubble. The pattern that has formed over the past 25 years is identical to most other bubbles with each feature being clearly defined.

I'm a huge fan of cycle analysis and use it on shorter timeframes for trading. However here we are looking at a more macro level analysis using only large cycles. Cycles on this time frame are never going to be precise, and only provide a general range to watch for bottoming processes at.

The current red cycle shown has the next trough (buy zone) around the middle of 2024. That coincides with the approximate time the fed has stated it will begin reducing rates, which gives it some extra validity (even though I came up with these cycles way before the crash even began!).

There is also a double cycle trough zone in 2028 and 2029 afterwards, usually such a pattern signifies some type of double bottom.

If these cycles are correct, there is huge opportunity to be had from the 2024 cycle trough going long. If that is not 'the' bottom of this crash, then a significant rebound will likely still happen from that area.

This overall 20 year long pattern does not end well in nearly all cases I have seen it, and in my opinion has the potential to bring the S&P 500 down into the 2000-2400 area. Do NOT underestimate how low a crash can go before it bottoms.

It's also worth taking a look at the volume profile that has formed over the course of this megabubble.


And as always, this is my personal opinion and is NOT advice and your own trading is at your own risk, do your own DD.