The setups I include on this blog are used in conjunction with the 3/10macd and the criteria I ascribe to it as a way to alert me to an existing condition of price. The key concept to take away from this blog is that I try to anticipate what will happen on the higher time frame by using a faster time frame to trigger the trade setup. I do not trade a "system" I use two indicators to clue me in to price conditions. Please read the Disclaimer located in the sidebar of this site. I can be contacted via email at
I am always open to questions, comments, or suggestions on how to improve this blog.

Monday, May 7, 2012

corrective cycle

While the Stevenson PTT concept is a bit difficult to read in trending markets it does tend to be clearer in range-bound or corrective markets.  Take the SPY for instance;  going back over the past month price has adhered to roughly a 10-day cycle while it tries to determine a direction for a more sustained move.

I have never really been satisfied with the reliability of the Stevenson target projections (red line), but the CTL (purple line) usually holds true to definition (CTL = Cyclic Trend Line, where a close outside this line indicates the beginning of your next cycle phase).

Here was another classic corrective cycle last summer with very symmetrical cycle lengths

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