Walter Bressert Futures OnLine Using Cycle Trading Patterns to Buy Bottoms & Sell Tops in the Direction of Trend and at Trend Reversals
Trend and Price Swings - 1

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This chart could be any time frame -- weekly, daily, 1-hour, 15-minute, 1-minute, 8 ticks. It doesn't matter. Every time frame has a dominant trading cycle that can be used to forecast future tops and bottoms. The green timing bands forecast tops, the red timing bands forecast bottoms. Time forecasts are made after the previous trading cycle has bottomed.

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Chart 2
To understand the rationale behind a price swing, think of pushing a child on a swing in a playground. The swing goes up, runs out of momentum and drops down, then moves up in the opposite direction until it runs out of momentum. Swing lows and swing highs are turning points in in short-term momentum. Here's how you identify them:
A swing low is a price bar between two or more price bars that have higher highs and higher lows as in "SL1". A swing high is a price bar between two or more price bars that have lower highs and lower lows as in "SH2". Every cycle high is a swing high, and every cycle low is a swing low. But every swing high is not a cycle high and every swing low is not a cycle low.

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Chart 3
An uptrend can now be seen to be a series of higher swing highs and higher swing lows. A move from a swing low to a swing high, or from a swing high to a swing low, can be only one bar, or it can be many bars. A one-bar swing is the weakest and penetration of a one-bar swing is the weakest confirmation of a trend reversal. A penetration of a multi-bar swing is a much more significant indicator of a trend reversal.

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