Cycle Indicators - Fibonacci - Seasonal Trade - Gann Theory - Elliot Wave

Proper Use of Cycle Technical Indicators

Futures chart Cycle indicators is a term to indicate repeating patterns of market movement, specific to recurrent events, such as seasons, elections, etc. Many markets have a tendency to move in cyclical patterns. Cycle indicators determine the timing of a particular market patterns.

Many securities, particularly futures, show a strong tendency to move in cyclical patterns. The theory is that price changes can be anticipated at key cyclical intervals, or periods. The time span of market cycles can run from several decades to only a few days, or even hours. Within each market, several cycles of differing time periods act upon the prices. Since price patterns are a result of these overlapping series of cycles, it is common to combine two or more cycles to form a composite cycle, specific for each market and analysis time frame. The following indicators and line studies can be used to measure cycles:

:::::>Fourier Transform

Fourier transform is based on the principle that any finite, time-ordered set of data can be described by decomposing it into a set of sine waves, which are specified by cycle length, amplitude and phase relationship. To use Fourier on trending data of commodity prices, you must first de-trend the data with a linear regression trend line or a moving average.