Long term analysis:
Mkt will be flat or go down to bottom around Mar ( a month ahead of Apr 10) to consolidate the calibration from the earning release before taking a new direction start mid of march to start a new round of the speculation, which will be calibrated again before Jun which will be another range peak or range low (a month before the July 10). Then, it will again go to bottom at the Nov, and after than start to run up again. This is annual business cycles. Which is the earning release period and which will calibrate the market. After the calibration, the mkt will experience the period of range trading until it find the new direction either go up or go down. Normally, after the earning release, the mkt might be over stretched, it will pull back from the previous move. Then, it starts to find the direction.
So, you can use the Range bound or Fibonacci pullbacks and other tools to determine the size of pullback. So, INDu might pullback to 50% to 10,530. So, next week, next week, mkt might go up.
And also, the quarterly bollinger band could be a very good tool to determine the exit or enter points.
Weekly charts:
For a very long term, the market will be flat before go down the bottom at the middle of March, the mkt will go up during the second quarter, and pull back before the end of the second quarter, and the market will start to move up during the third and pull back at the first half of the fourth quarter, and during the second half quarter, the market will persistant keep up into next year.
Feb will be sideway trading. So, it might be a good chance for range bound trading with BB, price channels, MACD, RSI. Trendline channels. The market range bound is based on the market fundamental that the market earning release is over after Feb. 10, and that is the market is completely calibrated by the fundamental. So, it will be a period of the consolidation before it really takes off. So, before the march, or 1 month before the first quarter ends (Mar.30, Apr 10), the market will either go up or down based on market expectation.
But this year, it is very likely, it will take off after Apr. 10. Even mid march.
In addition, by running MACD strategy, It shows that Apri, Jun, and Sept. and Oct, market shows a tendency for trending, and for the rest of the years especially, Mar. July and Dec, the mkt shows more a tendency for reversal or sideway trading. But the 30 min MACD shows the different patterns: with strong gain between Mar to May, with strong gain during April. The July is negative, so, it could true that July is the reversal period or the time of sideway.
Another point is that Aug shows a strong gain from MACD(30min), Aug. could be a strong trend period for intraday, though not for long term. This is saying that Aug is mostly the time for high volatility, and mkt madness.
Apply to OEX daily, it shows that Mar. and Apr. are MACD profitable, shows the period is trendling. And July is the period with negative gain, shows the period mkt is sideway trading for the most. You should use the range trading. When mkt is in the sideway, that is the period to use the range bounding trading. Such as Aug, the mkt is sideway trading for long term, and that will be a good period for the short term MACD trading.
Apr is absolutely trending period since MACD(D) and MACD(30Min) are both profitable.
Feb. Both MACD(D) and MACD(30min) are negative, so, this is the narrow range for mkt brkout. This is the period after the earning release, so the market will be very narrow and consolidating.
Dec is the month market will be consolidating for the long term. But with wide range.
Not the narrow range, the volatility is high.
The midCap and small cap shows a even strong trending tendency during Apr. and Oct. as we can see from MACD(D), so, that is the mkt trending.
Jan. and Feb which are negative for both MACD(D) and MACD(30min). This period is absolutely should be range bound trading. Since even for the short term, the trend is not reliable. So, it has to be completely range bound trading.
For energy, the mkt don't have long term trend. Only for Apr and Jan, and Jun, it shows a little long term trend. For the rest of the month, mkt is pretty much seesawed. This is the nature of the commodity when is the raw material.
But the short term trend exist for all the month, so the MACD is reliable for the energy market.
Which is more likely in the range bounded trading except for Aug and July.
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