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2012issue C0442-48

Constructing a dominant-cycle forecast as a timing window

A dominant-cycle model is assembled from the longest rhythm downward, tracked with multi-lookback price-velocity, and published as a statistical turn-window on the time axis rather than as a price target.

  • Start with the longest rhythm on the longest available ordered series, then layer two or three named embedded cycles beneath that dominant cycle.
  • Construction has three layers: a number-based cycle length, statistical checks of central tendency and standard deviation, and tracking tools that flag turns as they form.
  • Plot price-velocity over at least three lookbacks to track the cycle, and build trend separately as current price expressed as a percentage of range.
  • Issue a turn-window scored with one-, two-, and three-standard-deviation bands. The forecast times a possible trend change and does not state move size.
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Current trackDominant cycle detection119 readings

This article reconstructs how a dominant-cycle forecast is put together. The finished product is a turn-window: a statistically bounded interval on the time axis where a cycle is due to change. It does not specify the size of the subsequent move.

Isolate the longest rhythm first

A dominant-cycle model is built top-down. The longest rhythm on the longest available ordered series is identified first. Shorter embedded cycles are then layered beneath it. Embedded cycles are typically modeled as two or three named subcomponents inside the dominant cycle.

Cycle identification starts with visual inspection of an ordered series, then statistical analysis and regression modeling. The genesis-point is the first observation from which a given cycle is treated as existing.

The constructed cycle is not required to keep a constant period. It may skip iterations, stretch, compress, or recombine into a new cycle.

Build in three layers

Construction uses three layers. The first is a number-based derivation of cycle length. The second is statistical checks of central tendency and standard deviation. The third is tracking tools that flag turns as they form.

Instrument the cycle with price-velocity

Cycle tracking uses price-velocity over at least three lookbacks plotted together. Price-velocity is current price versus price a fixed number of periods earlier. That tracker measures the cycle under study, not the trend.

Trend is constructed separately, preferably as the current price expressed as a percentage of the range over a chosen lookback.

Read translation, then publish a turn-window

In advances the cycle crest is expected to the right of midpoint. In declines it is expected to the left. That shift is translation.

The cycle forecast is a window on the time axis for a possible trend change. Historical turns are scored against the projected date with one-, two-, and three-standard-deviation bands, corresponding to about 68 percent, 95 percent, and 99 percent of observations.

S&P 500 cash percentage-range, Dec 2010–Mar 2012

On the S&P 500 cash index, Harley’s percentage-range stack shows the trend cycle: the slow 4 percent smooth crests near the 2 May 2011 high, slides into the 4 October 2011 low, then turns up into early 2012. The 144-period range oscillator and the 20 percent smooth confirm the same turn with more noise. Coordinates were read from the published chart raster, not from a table.
On the S&P 500 cash index, Harley’s percentage-range stack shows the trend cycle: the slow 4 percent smooth crests near the 2 May 2011 high, slides into the 4 October 2011 low, then turns up into early 2012. The 144-period range oscillator and the 20 percent smooth confirm the same turn with more noise. Coordinates were read from the published chart raster, not from a table.S&P 500 Cash Index · December 2010 – March 2012 · 2010-12-07T00:00:00.000Z to 2012-03-05T00:00:00.000Z

Y follows the source figure’s 0 (top of the lookback range) to −100 (bottom of the range) scale. Series names match the printed legend. Values are digitised from a magazine raster, so turning-point levels are only good to a few percentage-range points.

Educational research material, not investment advice. Historical source context does not establish present-day performance.
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201232-35 pp.Next on Dominant cycle detectionOpen-parameter construction of dominant-cycle baselinesA dominant-cycle construction takes ordered observations, a defined sampling-interval, and a lookback, then emits a forecast-style baseline for later comparison.
All readings on this track · 31 readings
  1. 1982Cycle phase windows for chart signal filters
  2. 1987Constructing a cycle-scaled trend oscillator
  3. 1987Constructing a dominant-cycle grid from marked lows
  4. 1988Cycle lead from staggered exponential averages
  5. 1988Auditing the forty-month stock-price cycle
  6. 1989When long-wave dominant cycles cannot be disproved
  7. 1991Half-cycle average plot shift versus cycle attenuation
  8. 1991Half-cycle average contact as an amplitude-ratio test
  9. 1993Building a restoring-pull indicator from cycle frequency and volume
  10. 1995Regime filters for a dominant long wave
  11. 1995A cycle-tuned lead filter from bounded oscillators
  12. 1998Testable cycle rules instead of fear and greed
  13. 1999Nested Euro cycle timing as one checkable procedure
  14. 2002Constructing an instantaneous trendline from a dominant cycle
  15. 2002Half-cycle center of gravity oscillator from moving-average balance
  16. 2004Testing a locked forty-week cycle with a hold-or-sit-out rule
  17. 2005Nested timing bands for dominant-cycle confirmation
  18. 2005Dominant-cycle baselines versus policy-news narratives
  19. 2006Pairing a dominant-cycle horizon with trend and oscillators
  20. 2006A dominant-cycle split into a trend filter and residual Relative Strength Index
  21. 2007Construct a momentum difference from the dominant cycle
  22. 2007Naive dominant-cycle rules fail without crowd tests
  23. 2012Constructing a dominant-cycle forecast as a timing window
  24. 2012Open-parameter construction of dominant-cycle baselines
  25. 2013Using a second-term election to check a predeclared dominant-cycle forecast
  26. 2014Constructing a dominant-cycle forecast baseline
  27. 2014Quotient transform as an early-onset trend filter
  28. 2014Construct a trough-to-trough cycle map with the Detrended Price Oscillator
  29. 2015Dominant-cycle alignment before an earnings catalyst
  30. 2017Causal reverse exponential average for cycle and trend
  31. 2020Constructing a cycle-plus-trend oscillator from a one-wavelength chord
By fieldCycles and spectral analysis77 readingsBy year201281 readings
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