Friday, March 31, 2017

The Flash Crash cycle is coming

http://safehaven.com/article/44056/the-flash-crash-cycle-is-coming

The May 6 2010 mini Crash became known as the Flash Crash. I first discovered a 360 Trading Day (TD, Gann’s 360 degrees) cycle and posted it on my public blog, when the Flash Crash occurred, which is why I named it the Flash Crash (FC) cycle of Lows. 

The 360 TD Cycle is about 75 weeks, which has been in the markets ever since the April 14 2000 mini Crash Low and has since pinpointed 8 major crash Lows in the past 17 years, including the 4/14/00 mini crash Low, 9/21/01 crash Low, 3/12/03L, 8/13/04L, 11/2108 crash Low, 5/6/10 Flash Crash, 10/04/11 Low and more recently the 1/20/16 crash Low.

Many of the 360 TD/75 week flash crash cycle Lows were major Panic Lows, like the 4/14/00 Low, 9/21/01 Panic Low and the 11/21/08 Banking crisis Low. A few, like the 3/12/03 Low and 8/13/04 Low were not Panic Lows, but still major Lows.  At times the FC Cycle skips a beat, out of the last 12, 8 (67%) were direct hits and 4 (33%) were misses.

The dominant Flash Crash 360 TD / 75 week Cycle:


04/14/00L – 09/21/01L = 01 X 358.00 TD = 01 X 525 CD = 01 X 75.00 weeks
04/14/00L – 03/12/03L = 02 X 363.50 TD = 02 X 531 CD = 02 X 75.86 weeks
04/14/00L – 08/13/04L = 03 X 362.00 TD = 03 X 527 CD = 03 X 73.33 weeks
04/14/00L – 11/21/08L = 06 X 360.67 TD = 06 X 524 CD = 06 X 74.83 weeks
04/14/00L – 05/06/10L = 07 X 361.14 TD = 07 X 525 CD = 07 X 74.98 weeks
04/14/00L – 10/04/11L = 08 X 360.63 TD = 08 X 524 CD = 08 X 74.82 weeks
04/14/00L – 01/20/16L = 11 X 360.36 TD = 11 X 524 CD = 11 X 74.79 weeks
04/14/00L – June 2017 = 12 X 360.00 TD
04/14/00L –  July 2017 = 12 X 75 weeks


The Flash Crash Lows were preceded by an average 18% decline:

  1. 04/14/00 Crash Low saw a 213.57 SP decline,   a 14% decline.
  2. 09/21/01 Crash Low saw a 371.18 SP decline,   a 28% decline.
  3. 03/12/13 major Low saw a 165.38 SP decline,    a 17% decline
  4. 08/13/04 major Low saw a 102.51 SP decline,    a  9% decline.
  5. 11/21/08 Crash Low saw a 699.36 SP decline,   a 49% decline
  6. 05/06/10 Flash Crash saw a 139.34 SP decline, a 12% decline
  7. 10/04/11 Crash Low saw a 295.81 SP decline,    a 22% decline.
  8. 01/20/16 Crash Low saw a 322.43 SP decline,    a 15% decline.

The exact 360 Trading Day cycle has deviated by only 2 to 8 TD:

04/14/00L +360 TD X 1   =  09/21/01 Crash Low, + 2 TD
04/14/00L +360 TD X 2   =  03/12/03 Major Low,   - 7 TD
04/14/00L +360 TD X 3   =  08/13/04 Major Low,   - 6 TD
04/14/00L +360 TD X 6   =  11/21/08 Crash Low,   - 4 TD
04/14/00L +360 TD X 7   =  05/06/10 Flash Crash, - 8 TD
04/14/00L +360 TD X 8   =  10/04/11 Crash Low,  – 5 TD
04/14/00L +360 TD X 11 =  01/20/16 Crash Low,  – 4 TD


Swing High before the Flash Crash Low

03/24/00H – 04/14/00L = 021 CD / 0.7 Months
05/22/01H – 09/21/01L = 122 CD / 4.0 months
12/02/02H – 03/12/03L = 100 CD / 3.3 months
06/24/04H – 08/13/04L = 050 CD / 1.7 Months
08/11/08H – 11/21/08L = 102 CD / 3.4 Months
04/26/10H – 07/01/10L = 066 CD / 2.2 Months
07/07/11H – 10/04/11L = 089 CD / 2.9 Months
11/03/15H – 01/20/16L = 078 CD / 2.6 Months

The declines from the swing High to the Flash crash Lows have averaged 78.5 CD or 2.6 Months +/-. The majority has varied from 2.2–3.4 months. This means we should top out an average of 2 ½ months before the projected June-July Flash Crash Lows.

The Biblical 7 year Cycle and the 360 TD Flash crash Cycle


Forecasted on 12/17/14 (see link above):
“The future 9/28/15 Blood Moon total Lunar Eclipse is another biblical 7 years/1800 TD (Trading Days) from the 8/11/08 swing High, before the panic into 11/21/08 crash Low, which was 1805 TD from the 9/21/01 Crash Low and 1800 TD in the future is January 2016.”

5 X 360 TD Flash Crash cycle is the 1800 TD cycle, which is the well known 7 year Biblical cycle, which suggested a sharp decline in January 2016, being 7 years/1800 TD, from the 11/21/08 Crash Lows, which was 7 years/1805 TD from the 9/21/01 Crash Lows. The 1800 TD Cycle varies between 1790 and 1805 TD.

This 1800 TD/7 year cycle+/- has pinpointed major Highs and Lows in the past:
1.                  10/11/07H – 12/05/14H =1800 TD
2.                  08/13/04L – 10/04/11L = 1798 TD
3.                  03/12/03L – 04/26/10H = 1793 TD
4.                  03/12/03L – 05/06/10L = 1801 TD (Flash Crash)
5.                  09/21/01L  11/21/08L = 1805 TD
6.                  09/01/00H – 10/11/07H = 1785 TD
7.                  08/11/08H - 09/28/15H = 1792 TD
8.                  11/21/08L  01/20/16L = 1800 TD

Conclusion: The Flash Crash Cycle of Lows pinpointed 8 major crash Lows, in the past 17 years, with an 18% average decline and has deviated maximum 2-8 TD from its exact 360 TD cycle. It has a 67% chance of seeing a decline into it. The 1800 TD/ 7 Year Cycle is 5 X 360 TD cycle, which has also pinpointed major Highs and Lows in the past, including the recent 1/20/16 Low. If we are going to see a Flash Crash we should see a major swing High about 2 ½ months before we see a sharp 18% decline into the June-July Flash Crash Lows. That means we should top out in April or even as early as today’s 3/30-31 cycle High. You won’t want to miss the upcoming decline. Be forewarned and be prepared.

Raj Ian G. Thijm, Bsc, MBA
President of Raj Time and Cycles, Inc.

19 comments:

Elton Kelley said...

Raj, thanks for sharing. Again, super commentary and outstanding research. Based on what I see (my own look at charts), I agree that we will see a "big" decline by the summer, but that it will not be the end to lower prices. I think 2019-2020 will again be the time to buy.

Michael Cook said...

Thank you for the post. From your charts, the hits/misses of the FCcycle appear to be clustered, rather than randomly interspersed. Going further back overtime, would you say that observation is validated or not? If so, it would add credibility that this upcoming cycle date might be a "hit," rather than not. Either way, the alert is appreciated.

tradingdaze said...

Great analysis Ian (as usual). All the best.

Raj Time and Cycles said...

You're welcome Elton. Yes I also believe a longer term Low is due in 2020-21 Time frame.

Thanks Michael, I haven't noticed that.

Thanks Trading Daze!

Raj Time and Cycles said...


Follow these updates on: https://twitter.com/TimeandCycles


Rajacar‏ @TimeandCycles 22h22 hours ago
Today's decline confirms the 3/30-31 Solar time CIT Highs as mentioned in the FC Cycle article on Friday.

Rajacar‏ @TimeandCycles 2h2 hours ago
Today is a Precurser of what is to come, we should be down 25+SP and closes on its Lows and tomorrow 4/5 makes a lower Low and reverse after

Rajacar‏ @TimeandCycles 55s55 seconds ago
Daytraders: The intraday cycle sees a 1st hour Low, midday Low and last hour Low.


Rajacar‏ @TimeandCycles 14s14 seconds ago
If the midday Low is lower than the 1st hour Low, it suggests we see a last hour lowest Low and Vice Versa. We made a 10.15 1st hour Low

Monsao said...

Hey Raj......thanks for sharing....today's close (Thursday) looks triangular.....any chance this is a continuation move higher?
Tx

Monsao said...

12:30 eastern here....going LONG and strong SPX...all momentum...have great weekend!

Raj Time and Cycles said...

Rajacar‏ @TimeandCycles
Daily CITs: 4/5 Geo and Mother Divine CIT was a 4/5 swing High

Rajacar‏ @TimeandCycles
Intraday 5 min SPX CIT (Change in Trend) Times 4/11/17: 11.20, 12.05, 3.30, 3.50 pm Eastern

Monsao said...

Well Raj......every oscillator is negative in some way or interpretation....maybe the decline begins?.....good luck to all!

Raj Time and Cycles said...

Rajacar‏ @TimeandCycles
June Emini SP Support was pierced at 2332.25 /ES, but rebounded this morning, how much longer will support hold? Timing will be Key (chart attached, see https://twitter.com/TimeandCycles)

Monsao said...

Raj...this is the challenge for timing using cycles. If, for instance, you have a cycle of some sort that happens every other day...then which one is important or useful for your purposes? A swing trader would prefer substantial moves in duration and price movement to be of use. This move down looks weak and hanging on to support. I just look at overhead resistance using a simple 18 MA....if this move is a head fake then time to go flat or try some longs for a rebound higher.........maybe a wave 5 awaits?...........only the shadow knowz!
:)

Raj Time and Cycles said...

Rajacar‏ @TimeandCycles
Could we see a complete retrace of yesterday's gains?

Monsao said...

Looking like a doji today...after a Hobson close the day before (whatever that is).....do you think we pop and drop?....is the big drop still on the table....or will some cycle call the bottom next week in retrospect

Raj Time and Cycles said...

Rajacar‏ @TimeandCycles
Emini channel and trendlines we need to watch pic.twitter.com/BGCTdU9qPB

Monsao said...

Raj thanks for your updates! On a 2day chart the 18MA seems to provide overhead resistance.....we a rallying into it....my guess is we hit it and fade lower......delayed signal processing now is saying the path of least resistance is down overall....so lets see........whipsaws are the worst case scenario...the triangle forming looks more terminal than continuation because we need a deeper retrace to move higher......thus aiding short positions....good luck to all!

Monsao said...

Raj,
Momentum waning at this point..(short term outpacing longer term momentum)...likely you have a cycle in play....lets see if a fractal forms.......any comments?

Raj Time and Cycles said...

Hi Monsao,

I mentioned this on twitter on 4/25:

Rajacar‏ @TimeandCycles Apr 25

Any FC cycle will have to wait on fresh All time Highs coming first, but we will still see those June-July 2017 FC Lows.

Raj Time and Cycles said...

Rajacar‏ @TimeandCycles 4/27/17 9.30 am Eastern:
Watching Red Mid channel resistance on the June Emini SP

Join twitter to see the recent Chart at: https://twitter.com/TimeandCycles

Monsao said...

Raj,
I try to harness the lag of moving averages....when regressed and realtime make meaningful crosses....we are now in bull mode....I will have to cover my shorts and go long tomorrow on pull backs....Charts Edge.com seems to do well on sideways markets...I maybe incorrect....I guess the decline will have to wait....we may dip and rip....good luck to all...this is a tough market....the trend is your friend... Until it ends