“Cycles On Parade”Synchrony of Turning Points

Stock Market Cycles, August 2020

Lars von ThienenMember of the Boardlars@cycles.orghttps://cycles.org

© 2020 FSC, Lars von Thienen

Preface“The Most Significant Evidence“ Edward Dewey

2

The Synchrony of Cycles“Maybe we were just playing games with numbers. […] Then we began to look more closely at all the cycles with the same length, and what we discovered convinced not only me but a large body of previously doubting scientists that cycles are a reality. The ultimate clue finally came to light! We discovered that all cycles of the same length tend to turn at the same time! They act in synchrony. […] We have a synchrony of turning points.“

Edward R. Dewey (1971):“CYCLES: The Mysterious Forces That Trigger Events”,Chapter “The Ultimate Clue”, Page 189-190

© 2020 FSC, Lars von Thienen

Content

3

Section 1: Cycles 101 – Introduction

Section 2: Review: The 170er Cycle in HY1 2020

Section 3:Outlook: Daily Stock Market Cycles, August 2020

Section 1: Cycles 101 - Introduction

© 2020 FSC, Lars von Thienen

Basic Cycle & Cycle Detection ExampleTemperature in Hamburg

5

Dataset: Daily Temperature Hamburg, Germany (F)29. Mar. 2019

Cycle Detection Results:Cycle Length: 362 d (pink)Next high: ~Aug 2019Next low: ~Jan 2020

© 2020 FSC, Lars von Thienen

Cycle Spectrum AnalysisTemperature in Hamburg

6

Dataset: Daily Temperature Hamburg, Germany (F)29. Mar. 2019

Cycle Length: 362 dNext high: ~Aug 2019Next low: ~Jan 2020

Cycle Spectrum reveals:

a) Currently active dominant cycles

b) Length of these cycles

c) Current status of its phase

d) Significance of the cycle

© 2020 FSC, Lars von Thienen

Components of Stock Market dataTrend, Noise & Different Cycles

7

Trend

Cycles

Noise

Output

data series based on trend, cycles & noise

Input

45d

80d

© 2020 FSC, Lars von Thienen

Cycle Analysis removes noise & trend to output cycle spectrum

8

Output

Cycle Spectrum of data series

Input

Unknown data series

45 days cycle

80 days cycle

© 2020 FSC, Lars von Thienen

Cycle Spectrum allows toplot cycle projections

9

Cycle Analyzer View

Section 2: Review: The 170er Cycle in HY1 2020

© 2020 FSC, Lars von Thienen

The Cycle Scanner

11

S&P 500 Cycle Analysis Spectrum as of 14 Feb. 2020

178 days cycle

50- & 55-days cycle

© 2020 FSC, Lars von Thienen

The current 170er parade in the S&Pin Feb. 2020

12

S&P 500 with dominant cycle length 178, Situation 14 Feb. 2020

© 2020 FSC, Lars von Thienen

The ~170-day market cycle marched in a parade with sentiment indicators

13

VIX Dominant Cycles 178/104 Projection, Date: 14 Feb 2020

projected sentiment highturning point

~27. March 2020

© 2020 FSC, Lars von Thienen

A Review: The ~170 days paradecalled the top and low in Q1 2020

14

VIX Dominant Cycles 178/104 projection …. and outcome (light blue line)

Outcome:

market registered lowon 23. March

© 2020 FSC, Lars von Thienen

The detected sub-cycles of 50d/55dhelped to identify a bottom

15

After the fact…S&P 500 Dominant Cycles (50, 55 days)** projection, 27 February

** The 50- and 55-days cycle showed up as peaks in the spectrum on 14th Feb.

© 2020 FSC, Lars von Thienen

Analysis & charts on the 170er cyclepublished publicly in Feb. 2020

16

“The Importance of Cycles in Predicting Future Turning Points”published in: “Traders World, The Official Magazine of Technical Analysis”, Issue #76 - Feb/Mar/Apr

Amazon Stock, Dominant Cycle Length: 169 & 70 bars, 4. Feb.

VIX Sentiment, Dominant Cycle Length: 169 & 70 bars, 4. Feb.

“By combining different data sets and the analysis of the dominant cycle, we can detect a cyclical synchronicity. […] Synchronous cycles […] could indicate a trend reversal for the market under investigation”

15. Feb. 2020, Lars von Thienen, Traders World Magazine #76

SP500, Dominant Cycle Length: 173 bars, 13. Feb.

Section 3: Outlook: Daily Stock Market Cycles,

August 2020

© 2020 FSC, Lars von Thienen

Real Cycle SpectrumS&P500 – 14. Aug. 2020

18

A current parade ?Stock Market Cycle Analysis, FSC Cycle Scanner, August 2020

”You too are in the parade.” (Dewey)

© 2020 FSC, Lars von Thienen

170 Days Cycle - Equal Weight S&P500

20

RSP - Invesco S&P 500 Equal Weight ETF, Date: 7 August 2020

?

© 2020 FSC, Lars von Thienen

168 days Cycle – NASDAQ 100

21

© 2020 FSC, Lars von Thienen

167 Days Cycle – Apple (AAPL)

22

© 2020 FSC, Lars von Thienen

177 Days US Tech. Sentiment CycleNASDAQ-100 Volatility Index (VXN)

23

© 2020 FSC, Lars von Thienen

184 days China sentiment cycle

24

CBOE China ETF Volatility Index

Date: 14. Aug. 2020, Data Source: https://fred.stlouisfed.org/series/VXFXICLS

© 2020 FSC, Lars von Thienen

S&P 500 Index170 days + Top 5 Cycles

25

© 2020 FSC, Lars von Thienen

The longer parade:Update on the 5.91y cycle (~310 weeks)

26

DAX Futures, Continuous Contract, Front Month, Date: 14.08.2020,

Data Souce: Quandl Futures

© 2020 FSC, Lars von Thienen 27

Will the U.S. Dollar Index join the parade?Top 3 Cycles Composite

U.S. Dollar Index, Data: DX-Y.NYB – Yahoo Finance, 14.Aug. 2020

© 2020 FSC, Lars von Thienen

TLT iShares 20+ Year Treasury Bond ETFTop 4 Active Cycles, 17. Aug.

28

© 2020 FSC, Lars von Thienen

Gold – Top 3 Active Cycles, 14. Aug. 2020

29

© 2020 FSC, Lars von Thienen

About the Author

31

Lars von ThienenFSC Board Member

As founder and CEO of Noggle AG, Lars von Thienen invented the independent desktop search and knowledge management app. He holds a degree in business engineering. As a member of the Aequitas Group board of directors, he is responsible for a group of companies with more than 400 internationally active business and IT consultants. Appointed by the Minister of Justice, von Thienen practices as a commercial judge. He develops algorithms and software for cycle recognition and has published two books on cycles which have been ranked in the Top100 books for Financial Engineering on Amazon (“Decoding The Hidden Market Rhythm”). Von Thienen is based in Hamburg, Germany.

Contact: lars@cycles.org

© 2020 FSC, Lars von Thienen

FSC

32