I have ceased to post the Hurst bands and cycle sum analysis and also the Master Time Factor charts and analysis within the "XJO by stock forum" in Hotcopper as I found it difficult to fit in constant updates in a seemingly unrelated heading of the day. I felt unnecessary pressure to always look behind my back when posting these updates in order to avoid being targeted albeit obliquely for posting in a separate heading whenever I post in the "XJO by stock forum."
Rather, I find the "Charts Forum" more acceptable to posting on a wide expanse of topics, and members are more open to discussion of classical tech analysis, pitchforks, gann stuff etc...
Since we are on this subject of Hurst, here's an update of my views as a byline:).
Hurst Equidistant and curvilinear Bands
The Hurst band or envelope is as shown. ( Projections in red ). Note the cycles are presently unstable, as there is low or inverse correlation between the price index and the cycle sum ever since the turning point low identified on the 5th May. This suggests a need to decompose the cycle sum, remove the noise and study the dominant cycles that are "pushing" the price index ie cycles that are correlated to the price index.
The cycles are decomposed and the following chart shows the cycles distribution. You can see that there are 4 general clusters of cycles.
Let's study each individual cluster to see if they are stable and useful for projection:
Short Term cycles - wavelength 12
The cycles of wavelength 12 are well correlated to price index and are valid for projection. If you draw vertical lines from the tops and bottoms of this cycle to the price index, you can observe that they are well correlated. Note- the next turning point is a low coming within the next few days( You can read the date from the axis- or at least estimate it from the chart:))
Medium Term cycles - wavelength 48
This forms the largest cluster. The cycles correlate very well to the price index and is the dominant cycle sum "pushing" the price. Again, you can check the correlation by drawing vertical lines from the cycles tops and bottoms to the price index. Note - we are at the threshold of a turning point anytime, ie. we are within the time window for the next low based on this dominant cycle.
Long term cycle- wavelength 88
This cycle is poorly correlated and not valid at present for projection.
Longer term cycle - wavelength 212
This cycle sum bears a good correlation with the price index but is a longer term cycle. As we are looking for a short term projection, we do not use this as the leading cycle sum for projection
Since this is getting a bit long winded, I'll not post the composite cycle sum of all these cycle wavelengths after the noise removal, and jump straight to the findings.
Findings/Conclusions:
1. The cycle sum charts of wavelength 12 and 48 are stable cycles that are "pushing" the price index during this present trend.
2. The cycle cluster of wavelength 48 is the dominant wavelength as it forms the largest cycle cluster in the decomposed cycle sum distribution chart. I will use this for projection and for timing the market turns of the XJO as it is well correlated to the price index.
3. For minor turns, the cycle sum of wavelength 12 is also valid.
4. If the turning points eventuate, the Hurst envelope will start to curve up once the price index establish an edge band transaction and turn the corner/change direction.
5. We are very near or within the time window for a turning point as indicated by the dominant cycle sum chart of wavelength 48. The caveat is that this dominant cycle remains stable and therefore highly correlated to the price index.
Phew! It has been a long post. Hope you found it interesting. To all friends in the Charts forum - sorry to post such a long winded post with analysis here...and hello to friends from the XJO by stock forum. Cheers!
Regards,
dascore
PS. Please read the disclaimer below, thanks. For entertainment purposes only.
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