How to profit by spotting cycles in the markets

By looking at charts, it's quite simple to spot market cycles. Used in conjunction with other analysis, they can give us an advantage in setting up a good trade.

One of the longest economic cycles in use today is the Kondratieff cycle. This lasts for 50 to 60 years (the duration is somewhat inexact). It describes the cycles of catastrophe (complete economic contraction) at one extreme, rising to recovery (maximum expansion) at its apex, then declining to catastrophe once more.

Kondratieff was a Russian economist working in the 1920s. So he was heavily influenced by the great bull market and economic expansion of that period. He had lived through the Great War, and noted that wars come in two varieties, economically speaking.

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John is is a British-born lapsed PhD physicist, who previously worked for Nasa on the Mars exploration team. He is a former commodity trading advisor with the US Commodities Futures Trading Commission, and worked in a boutique futures house in California in the 1980s.

 

He was a partner in one of the first futures newsletter advisory services, based in Washington DC, specialising in pork bellies and currencies. John is primarily a chart-reading trader, having cut his trading teeth in the days before PCs.

 

As well as his work in the financial world, he has launched, run and sold several 'real' businesses producing 'real' products.