Tuesday ended close to flat for the S&P 500 and its equal-weight version, while the Dow lost 0.35%, the Nasdaq 0.15% and the Russell 2000 0.40%. Two-year yields finished unchanged and the ten- and thirty-year yields slipped, with the market still pricing Fed hikes for December 9 and March 17. The dollar index fell 0.4%, Brent 0.5%, gold 0.2% and silver 1.65%. The chip stocks underperformed again but bounced off their worst levels, while money rotated into the hyperscalers and software, and the worry in AI has moved from demand to whether OpenAI and Anthropic can come public on the timelines and valuations bulls expect. The bank earnings season opened with Q3 numbers that were fine apart from softer bond trading, and the market’s concern is that conditions are as good as they get. Williams’ remark that conditions do not warrant further tightening in 2027 did little for Treasuries. Wednesday brings ASML before the European open, more banks, and the September CPI at 8:30 ET, which lands after this scan. Our cycle model, meanwhile, puts gold and the long bond at the very top of its floor-side scale.

Three floor calls now carry the model’s full reading. The long-bond ETF, flagged at +67 on September 30 and +87 on October 3, has reached the bullish maximum of +100 with its stage advanced to a bear exit, the sellers step back and the decline no longer carries. The price closed Tuesday 1.6% above its October 5 low, its highest close since September 28. Gold, in its window since mid-September and at +81 with a bear exit on Saturday, reaches the same +100 with the exit intact, and its August floor call at the same reading paid 12.3% to the August 24 high. The Hang Seng holds its +100 with a bear exit and took the 24,281 mark named on Saturday with Tuesday’s close of 24,345, the third higher close since its October 8 low. The 74-day cycle that carried its July floor and its September ceiling is the one at its trough now, 41 days after the ceiling, about half its length later. The one reading that left the zone without paying is the BRICS ETF’s ceiling call, carried by falling cycles alone, which dropped to zero this week with the price 5% above its October 2 low.

What ties today’s board together is momentum, which has caught up with the floors the cycles called. Three readings at the top of the bullish scale carry the same stage of momentum, and the rate side backs them from the other direction, because the ten-year’s -93 now rests on four cycles that have all passed their peaks, so the yield cycles have turned. The euro and the gold miners enter the floor side behind the leaders. The one open question on that side is the Russell 2000, where the window stays open at +87 while the price closed Tuesday at its lowest since May.

Our daily analysis filters roughly 45 markets through a cycle consensus engine. Each asset receives a Consensus Score from -100 to +100, the model’s summary reading for a possible turn, where positive values mark potential cyclical bottoms (a time window where a decline could end) and negative values potential cyclical tops (a window where a rise could stall or reverse). Readings beyond ±60 enter the critical zone, the range in which the model raises its alarm for a possible turn. Let’s take a closer look.

Bottoming cycles

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He has tested the idea on an unusual data set: the Finnish pop charts. In May 2006 the hard rock band Lordi won the Eurovision Song Contest for Finland with “Hard Rock Hallelujah”. Three years later the financial crisis had arrived and the mood of the country had turned. Together with Matt Lampert of the Socionomics Institute, Ketovuori built a tool that measures optimism and pessimism in pop songs and applied it to random samples of Finnish chart songs from 2006 and 2009. The 2009 sample was significantly more pessimistic. The study appeared in the Cambridge journal Popular Music in 2018.

Homo sentiens

His new book, “Waves of Change: A Study of Social Mood”, takes the argument beyond music. Thirteen essays on 160 pages connect music, media, history and economics, and they share one premise: we are Homo sapiens, the rational thinkers, and at the same time Homo sentiens, the feeling humans. Shared emotions rise and fall in waves, and revolutions, booms and busts follow those waves. The book compresses the thesis into one line: history does not repeat itself, social mood does.

Ketovuori holds a PhD, lives in Turku, Finland, and has lectured across Asia, Europe and North America. His previous book, “Socionomics: How Social Mood Shapes Society”, was published by Routledge in 2024. The field goes back to Robert Prechter, who has also endorsed the new book. Readers of this series know the name from my conversation with his son Elliott Prechter on Elliott waves.

Where mood meets the cycle

Cycle analysis starts from the data. I measure the dominant rhythm in a price series and project it onto the right side of the chart. The method says when a vibration is due to turn. It does not say what is vibrating.

Social mood is a candidate for the answer. Socionomic theory treats the stock market as the fastest register of collective mood, because a buy or sell order takes seconds while hiring, legislation and wars take months or years. In this view a price chart is a recording of mood, and the cycles I detect in it are the rhythm of collective emotion.

That leads to the point I want to test on Monday. A wave of mood has a form: optimism builds, peaks and gives way to fear. Whether it also has a period that can be measured is a different matter, and it decides how far the two schools can be combined. If mood keeps a rhythm, cycle tools can time it. If it only keeps a form, the cycle supplies the clock and mood supplies the context.

What I will ask Mikko

Four points are on my list for the conversation:

• How social mood can be read in the here and now, before the events it produces, and which indicators beyond the stock market carry the signal.

• Whether the waves of mood show a stable length, or whether they morph the way market cycles do.

• What the pessimistic mood he describes for the present implies for the economy and for financial markets.

• What Homo sentiens means for economic models built on the rational investor.

Live on Monday

The Cycles TV Special runs live on Monday, October 12, 2026, at 1800 CEST on the YouTube channel of the Foundation for the Study of Cycles:

Questions for Mikko are welcome in the live chat or in the comments below.

“Waves of Change: A Study of Social Mood” is published by Iff Books on October 27, 2026 in the UK and on November 3, 2026 in the US.

Book page: collectiveinkbooks.com/iff-books/our-books/waves-of-change

Foundation for the Study of Cycles: cycles.org

Friday closed higher across the board. The S&P 500 gained 0.58%, the equal-weight version 0.56%, the Dow 0.83%, the Nasdaq 0.63% and the Russell 2000 0.46%, and the S&P 500 sits back within 0.1% of Tuesday’s record close. Treasuries saw modest pressure and yields edged higher, with the market pricing Fed hikes for December 9 and March 17. Brent slipped 0.2%, gold jumped 1.5% and silver 2.5%. Parts of tech rebounded from Thursday’s slump over the OpenAI revenue debate, but the chip index extended its losses and Apple fell on a report of iPhone order cuts. SpaceX’s spectrum purchase hit the mobile carriers and lifted the tower stocks, Humana jumped on its Medicare ratings, and Delta closed flat after a margin squeeze from fuel costs. The Michigan sentiment reading could have been worse. The week ahead brings the September CPI on Wednesday, the PPI on Thursday, the big bank earnings and ASML and TSMC. Our cycle model, meanwhile, has the Hang Seng at the bullish maximum, and momentum has already turned with it.

The model’s floor calls drew their first price answers this week. The Hang Seng, whose ceiling window opened on September 3 and paid 6% to Thursday’s low, now posts +100, the bullish maximum of the scale, with a bear exit, the sellers have left the field and the decline appears finished, and it closed Friday 1.8% higher. That is a completed round trip, a ceiling called near the top five weeks ago and a floor now flagged at the top of the bullish scale with momentum behind it. The long-bond ETF took the 77.28 mark from Wednesday’s article on Thursday and closed Friday 1.1% above Monday’s low. The financials, read at the bearish maximum on September 3 near their high, fell 7.2% to September 30 and enter the floor side today at +68, a reading the model already counts as a possible floor, with a bear exit of their own. On the ceiling side corn, read at the bearish maximum of -100 with a bull exit on September 26 (the buyers step back, the rise no longer carries), closed Friday 11.7% below its September 21 high and has left the zone. Wheat lost 4.7% in three sessions to its lowest close since August. Solana, filed on Wednesday as the one alarm without an answer, fell 9.4% in the three sessions since. The one reading that left without paying is the euro’s, bullish since September 9 on rising cycles alone, which dropped out of the zone this week with the price at a one-year low.

What the board says today is that the floor side has started to pay. The Hang Seng’s reading is the first bullish maximum with an exit since Shanghai’s on September 24, and gold and the financials carry exits as well. Four more windows sit at +93, a step below the top of the bullish scale, with bear fatigue, the downward move is grinding to a halt, in the long-bond ETF, the real estate sector, silver and platinum. On the ceiling side the whole yield curve has moved up a stage to -93, deep on the topping side, with bull fatigue, the bulls are losing interest and the upward move is getting tired, on data that show the ten-, twenty- and thirty-year yields off their highs of Monday and Wednesday. The bond market is still being called from both sides, and this time both sides have moved a step.

Our daily analysis filters roughly 45 markets through a cycle consensus engine. Each asset receives a Consensus Score from -100 to +100, the model’s summary reading for a possible turn, where positive values mark potential cyclical bottoms (a time window where a decline could end) and negative values potential cyclical tops (a window where a rise could stall or reverse). Readings beyond ±60 enter the critical zone, the range in which the model raises its alarm for a possible turn. Let’s take a closer look.

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Friday closed higher across the US board. The S&P 500 gained 0.73%, the Nasdaq 100 1.0% to its highest close in more than a year, the Dow 0.49% and the Russell 2000 0.94%, with the chip index up 2.4% to its highest close since July. The tone was set before the open. Treasuries held Thursday’s gains, the market priced only 25 basis points of Fed hikes for the rest of the year, Brent fell on reports of stockpile releases, and Europe was up more than 1% in early trading with industrials, basic resources and chips leading. Asia was mixed, the Hang Seng lost 2.6% and mainland China was closed for the holiday. Nike’s outlook disappointed, the Tokyo CPI ran hot, and the September jobs report was due with the Street at 90,000 new jobs.

The ceiling calls of the past two weeks are collecting their price answers. Corn trades 8.3% below its September 21 high after the bull exit at the bearish maximum, the bulls leave the field and the upswing appears finished. Natural gas, read at -93 with bull fatigue on Wednesday, seven points from the bearish maximum and with the upward move grinding to a halt, now posts that bearish maximum of -100 with a bull exit of its own. The price sits 8% under its September 24 high, seven weeks after its floor call near 2.80, and that completes the round trip. The Hang Seng’s ceiling window, open since early September, has left the alarm range with the index at its lowest close since early July, 7.8% under its August high. On the floor side the chip index has run 17.5% since the September 16 scan read its decline as overstretched and closed Friday at its highest since July.

What holds today’s board together is that the ceiling side keeps paying while the first floor windows begin to move. The Russell 2000’s reading has advanced to bear fatigue, the decline is running out of steam, with two higher closes off Wednesday’s low behind it. The real estate sector enters the floor side at +63, just inside the alarm range, with bear exhaustion, the sellers have overreached with no counter-move yet, eight weeks after a ceiling reading that paid 8.7%. The whole rate complex sits in the alarm range at once, the yields on the ceiling side and the long-bond ETF on the floor side, with Thursday’s data showing the first stall below Wednesday’s highs.

Our daily analysis filters roughly 45 markets through a cycle consensus engine. Each asset receives a Consensus Score from -100 to +100, the model’s summary reading for a possible turn, where positive values mark potential cyclical bottoms (a time window where a decline could end) and negative values potential cyclical tops (a window where a rise could stall or reverse). Readings beyond ±60 enter the critical zone, a critical reading at which the cycle model raises the alarm for a possible turn. Let’s take a closer look.

Bottoming cycles

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Tuesday closed modestly lower. The S&P 500 lost 0.16%, the equal-weight index 0.11%, the Dow 0.25%, the Nasdaq 0.09% and the Russell 2000 0.35%. The news flow leaned the bulls’ way. New York Fed President Williams said more tightening will be needed but saw no urgency after the September hike, which the market read as an October skip, and the two-year yield fell 4.5 basis points while the ten-year and the thirty-year rose 1 and 4 basis points. The market now prices 34 basis points of hikes for the rest of the year with October at roughly even odds. Brent sank 2.6% to $102.50 on data showing healthy oil exports from the Middle East despite the war, gold rose 1.45% and silver 1.25%, and Carnival and CarMax delivered strong reports. Tech, capital goods, cruise lines and utilities led, while financials, steel, healthcare, staples and energy lagged, and market breadth stays thin. JOLTS came in cooler and consumer confidence softer than forecast. Wednesday brings the August PCE and Micron’s report after the close, Friday the September jobs report, where the Street expects a slowdown to 90,000 new jobs from 162,000.

The ceiling side has started to pay. Natural gas stood at the model’s bullish maximum on August 12 near 2.80, a floor reading carried on the record through mid-August and late August, and the price ran 17.6% to its September 24 high of 3.297. Saturday’s ceiling reading has since been answered with an 8.7% drop from that high. Corn took out the 527.50 mark named in the same edition on Monday, trades 3.9% below its September 21 high, and its reading has normalized out of the zone. The financials sit 7.5% below the high they set the day after the September 3 maximum, at their lowest close since the start of August. One reading on the record did not hold, the long-bond ETF’s floor call of July 29 sits 5.6% underwater as the ETF returns to the floor side today.

The single thread today is a market where the ceiling side is paying and the floor side is still being stretched. Solana returns to the bearish maximum of -100 with a bull exit, the buyers step back and the rise no longer carries, two sessions after its high. The Russell 2000, the euro futures and the Shanghai Composite hold their floor windows with bear exhaustion, the decline is stretched like an overextended rubber band, and all three closed Tuesday at or near their lowest levels since August. The rate complex shows the same picture from both sides. The ten-year yield’s ceiling window holds at -87 on Monday’s data, and the long-bond ETF enters the floor side at +67 after its lowest close since August, two readings that describe the same overstretched bond selloff.

Our daily analysis filters roughly 45 markets through a cycle consensus engine. Each asset receives a Consensus Score from -100 to +100, the model’s summary reading for a possible turn, where positive values mark potential cyclical bottoms (a time window where a decline could end) and negative values potential cyclical tops (a window where a rise could stall or reverse). Readings beyond ±60 enter the critical zone, a critical reading at which the cycle model raises the alarm for a possible turn. Let’s take a closer look.

Bottoming cycles

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Friday closed higher on hopes of an Iran deal and on another round of AI product enthusiasm. The S&P 500 gained 0.51%, the Nasdaq 100 0.42% and the Dow 0.93%, while the Russell 2000 finished flat at 0.07% after Thursday’s lowest close since the start of August. Reuters reported on Thursday that Tehran is pushing for a return to the June memorandum with nuclear talks to follow, Iran confirmed it, and Washington’s answer is still open, so Brent eased on Friday but stayed above $100. Microsoft’s relaunched Copilot took the AI spotlight from Meta’s Muse and Meta shares saw profit taking. Tech, travel, managed care, payments and capital goods led, while exchanges, cable, consumer staples, energy, utilities and REITs lagged, with new 52-week lows in the cable and staples groups. Capital goods orders for August came in healthy and the final Michigan reading improved slightly. On Thursday’s data the Treasury market sat at the highs of this move, the ten-year at 5.18%, the two-year at 4.87% and the twenty-year at 5.53%, and the long-bond ETF closed Friday at its lowest level since August. Next week brings OpenAI’s developer day on Tuesday and the Jabil and Micron reports on Wednesday.

Two round trips sit on the board this weekend. Corn’s reading stood at the model’s bullish maximum on June 26 near 413, and the price ran 32% to Monday’s high of 543. The reading now posts the bearish maximum of -100 with a bull exit, buying pressure gives way and the upswing appears broken. That is the ceiling half that first printed on September 12. The Russell 2000 carried a ceiling reading of -80 on August 15, printed on a close of 3,068 that turned out to be the summer high, and the warning sharpened to -73 on four cycles on August 29. Seven weeks and 7.5% lower, the index joins the floor side with a reading of +87. The chip index has risen 13% since the September 16 scan read its decline as overstretched, and its reading has normalized out of the zone.

Today’s thread runs through the floor side, which reads overstretched three times over. The Russell 2000, the Shanghai Composite and the euro futures all stand at +87 with bear exhaustion, the bears are in an overshoot and the downward move is overstretched, which is the stage the industrials and the chips carried on September 16 before price answered higher. At the ceiling corn holds the bearish maximum with its exit on six cycles, and the ten-year yield’s reading is back at -87 with bull exhaustion, the buyers have overreached with no counter-move yet, after the week’s spike in rates.

Our daily analysis filters roughly 45 markets through a cycle consensus engine. Each asset receives a Consensus Score from -100 to +100, the model’s summary reading for a possible turn, where positive values mark potential cyclical bottoms (a time window where a decline could end) and negative values potential cyclical tops (a window where a rise could stall or reverse). Readings beyond ±60 enter the critical zone, a critical reading at which the cycle model raises the alarm for a possible turn. Let’s take a closer look.

Bottoming cycles

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Tuesday closed lower across the US board. The S&P 500 gave up 0.45%, the Dow 0.63%, the Nasdaq 100 0.65% and the Russell 2000 0.76%. The move that mattered sat outside equities. WTI crude jumped 4.4% to $105.83. Diesel supply is the pressure point behind it. Half of Russia’s largest diesel refineries have cut output after drone strikes, and China is weighing fresh export limits on refined fuel. The grain complex ran with the energy bid, corn up 4.6%, wheat 3.0% and soybeans 2.6%. Gold slipped 0.44% and Solana dropped 6.7%. Wednesday has opened the other way. US futures came in higher, the European indices trade 0.2% to 0.3% up with semiconductors and banks leading, and Asia closed green with Shanghai 0.71% higher and the Kospi 1.37%. Brent sits near $108 and Treasuries are flat. The market prices a quarter-point hike from the Fed this afternoon, another in December and one to one and a half more through 2027. Retail sales for August came first, the decision follows at 2pm in New York.

One of the scan’s recent alarms has already been paid. Solana was flagged at -93 on September 9, the deepest reading on the board then and still the deepest today, and Tuesday delivered the answer with a 6.7% drop that leaves the price about 7% under the level of that alert. Corn did not hold its warning, the bull exit from Friday’s data (the bulls leave the field, the upswing appears finished) was answered by a 4.6% rise on Tuesday and the reading has slipped out of the zone at -59. The board around those two has arranged itself into an unusually uniform picture. Nine markets sit in the critical alarm range, and five of them share one stage, a move that has run too far and has yet to turn.

The thread that holds today’s board together is that both ends of it are stretched, floors and ceilings alike, on the afternoon the Fed decides. On the floor side the S&P 500 industrials hold +87 and the PHLX Semiconductor index +85, both within reach of the bullish maximum of +100 and both at bear exhaustion, the sellers have overreached with no counter-move yet. The Shanghai Composite joins at +73 on six cycles. On the ceiling side the two-year Treasury yield enters at -77 with bull exhaustion, the upward move is overstretched but still running, and the ten-year sits at -68 beside it. Every one of those windows is open. In Wednesday’s session the first movement arrives in the direction the floor side describes, the chip index up 1.4% and the industrials 0.4% as this is written, and none of it is a close yet.

Our daily analysis filters roughly 45 markets through a cycle consensus engine. Each asset receives a Consensus Score from -100 to +100, the model’s summary reading for a possible turn, where positive values mark potential cyclical bottoms (a time window where a decline could end) and negative values potential cyclical tops (a window where a rise could stall or reverse). Readings beyond ±60 enter the critical zone, a critical reading at which the cycle model raises the alarm for a possible turn. Let’s take a closer look.

Bottoming cycles

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Friday closed the week with a relief rally. The S&P 500 gained 0.86%, the equal-weight index 0.80%, the Dow added 508 points or 0.98%, the Nasdaq 0.96% and the Russell 2000 0.45%, after the announcement of a GCC-Iran meeting in Oman on Monday, the first since the war began. The August CPI came in a little firmer than expected on the core services side, and the market now prices 50 basis points of hikes for the year with roughly 90% odds of a move on September 16. The 2-year yield jumped 4 basis points on Friday while the 10- and 30-year were about flat, after a week in which yields had spiked on the CPI, the PPI and the $5,000 dividend idea from Washington. Brent pulled back about 2.5% to $104.85 on the diplomacy news, even as Saudi Arabia shut its East-West pipeline as a precaution. Gold rose 0.65%, silver 1.2%, bitcoin was flat. Under the surface the AI hardware names led, memory and security software lagged, and the Michigan survey showed year-ahead inflation expectations up to 4.6%. The Fed decides on Wednesday.

The CPI week has done its clearing work on the ceiling side. Three alerts we carried through the summer left the board this week, each with at least a first price answer. The wheat exit flagged on Sunday at -93, deep in the model’s topping range, did its work, the price gave back 5% from Tuesday’s rebound, and the momentum signal has now expired with the score easing to -80 with neutral momentum. The financials maximum of September 2 closes its episode at -33, back outside the alarm range, with the sector about 2% below the high it set the day after the alarm, a modest answer, on the record. The DAX’s second alarm expired at -38 after the index closed below the 25,839 we had named as the first confirmation level, a 1.8% dip from Sunday’s reading and no more, so the second half of the April round trip has a first step and no verdict. A new round trip opens at corn. The +100 floor call of June 26 near 413 has paid 29% to Friday’s 532, and the model now posts a bull exit at -61. The buyers step back and the rise no longer carries, and that reading opens the ceiling half of the trip.

The day’s thesis is that the summer’s ceiling alerts have cleared with the price on the model’s side, and the floor side has hardened at the same time. The S&P 500 industrials hold the bullish maximum of +100 with a bear exit, the decline has lost its drive and appears to be turning, and the backing has grown from four cycles on Tuesday to six, the broadest on the board. That keeps them the Chart of the Day. The PHLX Semiconductor index stays at +99 with a bear exit beside them, a point below the industrials, gold re-enters the zone at +63 on four cycles, and the euro futures hold +80, well inside the zone, on four. The rates alert has been re-armed by the week’s spike. The 10-year is back at -87 on Thursday’s data, close to the bearish maximum, with a bull exhaustion, the bulls are in an overshoot and the upward move is overstretched, and the Fed meeting on Wednesday is the next referee.

Our daily analysis filters roughly 45 markets through a cycle consensus engine. Each asset receives a Consensus Score from -100 to +100, the model’s summary reading for a possible turn, where positive values mark potential cyclical bottoms (a time window where a decline could end) and negative values potential cyclical tops (a window where a rise could stall or reverse). Readings beyond ±60 enter the critical zone, a critical reading at which the cycle model raises the alarm for a possible turn. Let’s take a closer look.

Bottoming cycles

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Tuesday was the first session after the long weekend, and it closed red across the board. The S&P 500 fell 0.58%, the equal-weight index 1.03%, the Dow dropped 626 points or 1.17%, the Nasdaq slipped 0.32% and the Russell 2000 0.52%. Treasuries sold off as oil rose again, yields up 1 to 3 basis points across the curve with Brent 1.4% higher at $98.33, while Fed pricing held near 35 basis points of hikes for the year and roughly 60% odds of a move on September 16. Gold lost 0.95% and silver 0.6%. The weekend’s US-Iran exchange and the Houthi attacks on Saudi Arabia set the mood, but the move that mattered in equities was the AI rotation. Days of praise for OpenAI’s Astra sent the pick-and-shovel names higher, chips, components, infrastructure and the data-center industrials, while software, services, payments and the financial data providers were sold hard. Wednesday brings the size of the Treasury buyback, Thursday the ECB decision and the PPI, Friday the August CPI.

The scan’s answer to Tuesday is a floor, not a ceiling. The S&P 500 industrials reach the bullish maximum of +100 with a bear exit, the sellers step back and the decline no longer carries, on four cycles between 39 and 167 days, and the PHLX Semiconductor index stands one point short of the mark at +99 with a bear exit of its own. Both calls were on the record on Sunday, already deep inside the alarm range at +88 and +89 with a bear fatigue, the bears losing interest and the downward move getting tired. The order of events since then is simple. The model warned on Sunday, the momentum trigger printed within one session, and in the semiconductors the price has already answered, the index up 1.3% on Tuesday and 4.7% over the last two sessions. The industrials dipped half a percent into their maximum, roughly 5% below their August highs, and that open question makes them the Chart of the Day.

The ceiling side has its own news. Wheat deepens to -94 with its bull exit intact, buying pressure gives way and the upswing appears broken, while the price rebounded about 4% on Tuesday, so the test we opened on Sunday runs again. The financials top call from last week received its first price answer, the sector 1.4% lower on Tuesday and below the close of its alarm day. The DAX’s second alarm has cooled with neutral momentum and no price break, so that test stays open. And the oil floor the scan has carried since mid-July leaves the board after Brent ran from about $89 to $98, the normal exit of a turn that paid.

Our daily analysis filters roughly 45 markets through a cycle consensus engine. Each asset receives a Consensus Score from -100 to +100, the model’s summary reading for a possible turn, where positive values mark potential cyclical bottoms (a time window where a decline could end) and negative values potential cyclical tops (a window where a rise could stall or reverse). Readings beyond ±60 enter the critical zone, a critical reading at which the cycle model raises the alarm for a possible turn. Let’s take a closer look.

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Wheat’s war rally meets its cyclical crest while a blowout jobs report fails to lift the long end

Friday’s jobs report blew past expectations, and the bond market shrugged. The Establishment Survey printed 162,000 new jobs against 55,000 expected, the Household Survey added 569,000, yet the unemployment rate and wage growth came in about in line and barely moved from July, so the Fed’s calculus hardly changed, with hike pricing edging from 33 to 35 basis points for the year’s final three meetings and the odds of a September 16 move near 60% from about 50%. Yields told the same muted story, the 2-year up 4 basis points, the 10-year up 1, the 30-year about flat. Stocks slipped, the S&P 500 off 0.38%, the equal-weight index down 0.47%, the Dow 0.51% lower and the Nasdaq off 0.29%, while the Russell 2000 gained 0.25%. Underneath the indices a rotation ran. AI equipment and chip names rallied on hopes tied to the Anthropic S1 filing, which a Friday-night report now pushes to later in the month, while software, Apple, Tesla and healthcare sold off. Brent added 0.6% to about $96.10, gold fell 0.85%, silver 1.15%, and bitcoin dropped 2.14% to $79,720. The weekend brought another US-Iran exchange and reports that Tehran plans to stretch the conflict for months, and on Sunday Beijing announced a $54 billion capital injection into its state-owned insurers and banks.

Three things stand out in the weekend scan. First, the rates test ended in the shape we sketched on Thursday rather than in a clean win or loss: the long end did not fall, but it also did not rise into the strongest data point of the week, a flat 30-year and a 10-year up a single basis point against a 2-year up 4. The 20-year, last week’s bearish-maximum alert, has eased to -56 on Thursday data and dropped below the alarm threshold, so that episode closes with the long end unlifted, while the 30-year and the 10-year keep the warning alive at -87, well inside the range where the model looks for a top. Second, the board’s deepest reading now sits in wheat at -93 with a bull exit, the upward move has lost its drive and looks ready to tip over, the war rally of the past two weeks meeting its cyclical crest, and that makes it the Chart of the Day. Third, the DAX warning holds at -90 on five cycles, and this one carries a longer arc: the same index was a +100 floor call with a bear exit on the record on April 10 near 23,800, the sellers had given up and the downswing appeared to be at its end, and the rally that followed ran nearly 12% to a record 26,570 by late August. The first half of that round trip is paid and on the record; the second half is the test now running, the full arc below.

Our daily analysis filters roughly 45 markets through a cycle consensus engine. Each asset receives a Consensus Score from -100 to +100, the model’s summary reading for a possible turn, where positive values mark potential cyclical bottoms (a time window where a decline could end) and negative values potential cyclical tops (a window where a rise could stall or reverse). Readings beyond ±60 enter the critical zone, a critical reading at which the cycle model raises the alarm for a possible turn. Let’s take a closer look.

Bottoming cycles

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Wednesday broke a losing streak. The S&P 500 rose 0.46%, the Dow 0.56%, the Nasdaq 0.45%, and the Russell 2000 led with 1.13%, while the equal-weight S&P kept pace at 0.44%. The trigger was a cooler ADP report, private employers added 38,000 jobs against 47,000 expected, the slowest pace since January. That kept a lid on yields, Treasury yields eased 1 to 3 basis points across the curve, with hike pricing steady at 38 basis points for the year and the odds of a September 16 move near 65%. Gold rebounded 1.4% and silver 2%, Brent extended its three-day rally with another 0.95% as the US-Iran clashes from Sunday and Tuesday did not recur, the dollar index slipped 0.08% while the yen jumped 0.85% on hawkish Bank of Japan rhetoric, and bitcoin dipped 0.15%.

The scan answers with a change of address for its strongest warning. The day’s story is a handover, the model’s most extreme topping reading has moved out of the bond market and into the rally itself. The S&P 500 financials reach the bearish maximum of -100 with a bull exit, the bulls leave the field and the upswing appears finished, while the sector trades in record territory and its banks outperformed again on Wednesday. That is the third escalation of an episode on the record since the sector’s first exit in late August, which price revoked within a day, and through last week’s re-arming at -93. It is also the second half of a completed round trip: the same sector carried a +80 floor call on the record on June 8 that paid 8.2% within four weeks, and today the opposite maximum meets it at the record, the full arc is laid out below. Beside it, the DAX’s reading returns to -89, almost at the outer edge of the scale and now carried by five cycles, the broadest backing the index has shown all summer. The rates warning ages without its answer, the cycle scores of all three long maturities hold at -87 on Tuesday data while global borrowing costs kept rising through the G20 meeting, and Wednesday’s small dip in yields is a first soft echo with the price answer still outstanding.

One position leaves the board on the model’s own terms. The gold floor flagged on August 5 and confirmed on August 9 paid through the month and has now normalized back to neutral, a completed episode with its record intact.

Our daily analysis filters roughly 45 markets through a cycle consensus engine. Each asset receives a Consensus Score from -100 to +100, the model’s summary reading for a possible turn, where positive values mark potential cyclical bottoms (a time window where a decline could end) and negative values potential cyclical tops (a window where a rise could stall or reverse). Readings beyond ±60 enter the critical zone, a critical reading at which the cycle model raises the alarm for a possible turn. Let’s take a closer look.

Bottoming cycles

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Friday belonged to Warsh. The Fed chair used his Jackson Hole speech to praise the labor market and to make clear that better inflation prints have not convinced him the underlying trend has improved, and the market took the hint. Pricing moved to 37 basis points of hikes for the rest of the year, up from 27 before the speech, with the odds of a September 16 move now near 57%. Yields rose across the curve, the Fed-sensitive 2-year spiking 12 basis points while 10- and 30-year yields added 5 and 2. Equities slipped in response, the S&P 500 off 0.25%, the Nasdaq down 0.52%, the Russell 2000 hit hardest at minus 1.39%, the Dow flat. The dollar index gained half a percent. The sharpest moves sat in the metals, where gold fell 3% and silver 4%, while wheat jumped another 3% to cap a 12% week as the Russia-Ukraine war escalated, and Brent eased 0.4% to around $89.30.

The scan answers with its deepest possible reading on exactly the market Warsh moved. The day’s thesis is that the long end of the bond market has run into a maximum-strength topping warning, a reading that the rise in yields could stall or reverse, while the Fed chair argues for higher rates, and one of the two sides has to give. The 20-year Treasury yield reaches the bearish maximum of -100 with a bull exit, the buyers step back and the climb no longer carries, and the 30-year escalates to -87 with a bull exit of its own. Both readings stand on data through Thursday’s close, so Friday’s yield rise ran into a freshly hardened alert, the same confrontation the rates call has carried since it escalated in the August 22 review and moved to the center of the scan on August 26. The second thread sits in the metals, where the model had already stepped down from most of the hard-asset wall it flagged on August 5 and confirmed on August 9. Silver and the miners dropped off the model’s alert list over the past two weeks, so Friday’s 3 to 4% metal slide landed on positions the model had normalized, and what remains under test is gold’s six-cycle floor.

Our daily analysis filters roughly 45 markets through a cycle consensus engine. Each asset receives a Consensus Score from -100 to +100, the model’s summary reading for a possible turn, where positive values mark potential cyclical bottoms (a time window where a decline could end) and negative values potential cyclical tops. Readings beyond ±60 enter the critical zone, a critical reading at which the cycle model raises the alarm for a possible turn. Let’s take a closer look.

Bottoming cycles

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Tuesday’s gains were real but narrow. The Nasdaq rose 0.66%, the Russell 2000 added 0.50%, the S&P 500 gained 0.32% and the Dow 0.30%, while the equal-weight S&P slipped 0.07%, so the advance leaned almost entirely on the AI complex ahead of tonight’s Nvidia report. The bigger moves happened away from equities. Brent tumbled 4.25% to around $88.30 as the diplomatic track around Iran gathered momentum. Pakistan reported progress from Monday’s talks in Tehran, Iran and Oman moved toward a deal on Hormuz traffic, and Hormuz itself was declared demined. Treasuries rallied on the back of the oil slump, with yields falling 5 to 7 basis points across the curve. Gold added 0.3%, and the market still prices roughly a quarter point of Fed hikes over the year’s final three meetings.

The rest of the week stacks the catalysts in a row, the July PCE print this morning, Nvidia’s earnings after tonight’s close, and Warsh’s Jackson Hole speech on Friday morning. That sequence frames the day’s thesis. The deepest reading of the entire scan now sits on the 30-year Treasury yield, where upward momentum is stalling at multi-year highs just as the week delivers the events with the power to decide the move, and Tuesday’s bond rally was the first price step in the direction the cycle model has been pointing. The other side of the scan holds the hard-asset floor we have covered since early August, a call that is on the record with the gold turn flagged on August 5 and the silver-and-miners confirmation that followed on August 9.

Our daily analysis filters roughly 45 markets through a cycle consensus engine. Each asset receives a Consensus Score from -100 to +100, the model’s summary reading for a possible turn, where positive values mark potential cyclical bottoms (a time window where a decline could end) and negative values potential cyclical tops (a window where a rise could stall or reverse). Readings beyond ±60 enter the critical zone, a critical reading at which the cycle model raises the alarm for a possible turn. Let’s take a closer look.

Bottoming cycles

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The DAX climbs to a fresh high straight into its top alert, and the long yields are lining up behind the same warning

Stocks bounced on Friday, although the major indices still closed the week in the red. The S&P 500 gained 0.4%, the equal-weight version of the index 0.6%, the Dow jumped 1.0%, the Nasdaq added 0.4%, and the Russell 2000 rose 0.9%. The bounce came despite a further rise in yields, which climbed across the curve as investors increasingly dismissed the Treasury’s buyback program as too small against the forces pushing borrowing costs higher, and the odds of a September Fed hike moved up toward 40%. The August flash PMIs were bullish, with growth momentum strengthening while inflation cooled, but the growth signal itself fed the move in rates. Brent edged up to about $94.10, gold spiked 2.25% and silver jumped 1.9%. The week ahead brings the July PCE on Wednesday, Warsh’s Jackson Hole speech on Friday, and the Nvidia and Salesforce reports on Wednesday night.

Two stories from this letter’s recent coverage moved again on Friday, in opposite directions. The real-asset floor kept paying, and both legs of that call are on the record. The gold turn flagged on August 5 and the silver confirmation that followed on August 9 both delivered another up day on top of Wednesday’s surge. The DAX, which the August 15 review named the next candidate for a momentum crossover and which completed that crossover on Thursday, answered with a fresh high instead. The model has not blinked. The German index holds the bearish maximum for a second reading, the rate complex now escalates behind it with both long Treasury yields moving to the edge of the same extreme on the very day yields rose, and underneath, the Nasdaq 100 joins the Composite on the bottoming side, so the thin tech floor flagged on Thursday has broadened by one index.

Our daily analysis filters roughly 45 global markets and condenses every detected cycle into a single Consensus Score between -100 and +100, where +100 is the strongest reading for a possible upward turn and -100 for a possible downward turn. Values beyond ±60 mark the critical zone, the range where the cycle model raises the alarm for a possible trend change. Today the scan shows eleven markets in the critical bottoming zone, where declines could end, and eight in the critical topping zone, where rises could stall or reverse. Let’s take a closer look.

Bottoming cycles

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The summer’s loudest floor call has traveled all the way to the ceiling as the BRICS ETF tops the warning list

Bulls won the week. The July inflation data cooled against June on both the consumer and producer side, following the soft July jobs report from the prior Friday, and expectations for a September Fed hike faded further. The AI boom supplied the rest. A heavy slate of tech earnings from Applied Materials, Cisco, CoreWeave, Nebius and others read bullish on the infrastructure buildout, Cisco spoke of a “networking supercycle”, and several operators emphasized improving returns on their AI capital spending. Workday jumped on Thursday after a report that Silver Lake is considering a buyout, a sign that value buyers are circling the legacy software names the market had written off. The counterweight came from the Middle East, where Brent spiked on Monday and Tuesday as Washington and Tehran drifted further apart before the pressure eased late in the week.

Into that risk-on close to the week, our cycle model turns its warning list international. The day’s story is the BRICS 50 ETF. In early July it carried the model’s strongest bottoming reading, meaning the market was in a time window where the decline could end, and a recovery of more than ten percent off the July low followed. Today the same ETF crosses to the topping side, a time window where the rise could stall or reverse, at the model’s strongest possible bearish reading, with India’s Nifty 50 and the German DAX standing close behind. On the other side of the table the real-asset complex, from gold and silver through the miners to uranium, consolidates the cyclical floor it confirmed in early August. Both legs of that call are on the record: the gold turn flagged on August 5 and the silver confirmation that followed on August 9. The rate complex leans exactly where the week’s inflation data pushed.

Our daily analysis filters roughly 45 global markets and condenses every detected cycle into a single Consensus Score between -100 and +100, where +100 is the highest score the model gives for a possible upward turn and -100 for a possible downward turn. Values beyond ±60 mark the critical zone, a critical reading at which the cycle model raises the alarm for a possible turn. Today the scan shows eleven markets in the critical bottoming zone and seven in the critical topping zone. Let’s take a closer look.

Bottoming cycles

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Friday delivered gains across the board as investors read the weak July jobs report through a “bad is good” lens. The Nasdaq gained 1.30%, the Russell 2000 added 1.10%, and the S&P 500 rose 0.62%. Treasuries rallied alongside, with yields falling across the curve, and the market trimmed its Fed expectations to roughly a quarter point of rate increases for the rest of the year. The dollar sank 0.4%. The strongest moves came from the metals, where gold rose 2.5% and silver jumped 3.4%, and our cycle scan has a lot to say about exactly that corner of the market. Brent slipped 0.6% to around $82 after a Reuters report that the Iran-Oman deal to reopen Hormuz should be released soon.

The jobs report itself was weaker than the rally suggests. Establishment adds missed badly with negative revisions, household employment declined, and the drop in the unemployment rate came from a slump in participation, which carries hawkish implications. The odds of a September hike still stand near 44%, and Friday revived the Fed-independence fight with the threat to remove governor Lisa Cook back on the tape. Against that backdrop, the story of the day in our scan is a single sequence. The hard-asset complex has moved from cycle warning to a turn that price now backs, with silver and the miners leading higher, and the long end of the bond market is lining up as the next candidate, this time for a peak in yields. Wednesday’s CPI print is the first test of that second leg.

Our daily analysis filters roughly 45 markets through a cycle consensus engine. Each asset receives a Consensus Score from -100 to +100, where positive values mark potential cyclical bottoms and negative values potential cyclical tops. Readings beyond the ±60 threshold define the critical zone, a critical reading at which the cycle model raises the alarm for a possible turn. Let’s take a closer look.

Bottoming cycles

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Elliott waves and time cycles both claim that markets repeat, and they claim it about different things. That distinction carried this episode of the FSC interview series, recorded with Elliott Prechter, President of Qualitative Analytics and developer of EWAVES, the software that automates Elliott wave analysis. The lineage behind him is three generations deep: R.N. Elliott catalogued the pattern in the 1930s and published “The Wave Principle” in 1938, A.J. Frost and Robert Prechter codified it in their 1978 book, and Robert’s son Elliott has spent the past decade turning it into executable code. His own path runs through MIT (2002), Microsoft (2006), a stint as CTO of an algorithmic hedge fund, and a guest piece in The Elliott Wave Theorist that recommended Bitcoin in 2010 at 6 cents.

Form, not period

A cycle repeats in time. It has a length, the length drifts, and the analyst’s job is to measure it and project the next trough. A wave repeats in form. Elliott’s observation was that markets advance in five waves and correct in three, and that this five-three structure is self-similar at every degree, from the intraday wiggle to the multi-decade advance. From an analytical perspective the two schools operate in different domains: cycle analysis lives in the frequency domain and asks when, wave analysis lives in the pattern domain and asks where in the structure you stand. Both are recurrence claims about the same tape, made along different dimensions, which is precisely why the comparison is worth an hour of conversation rather than a dismissal from either side.

Teaching the machine to count

The standard objection to wave analysis has always been the analyst: ask five Ellioticians for a count and you receive five counts. Prechter’s answer was not to train a neural network on past charts but to build symbolic AI, encoding the wave model’s own rules and guidelines into software. EWAVES generates candidate counts and grades every wave with an elliotticity score, an absolute measure from 0 to 100 percent of how well the structure conforms to the model, and its pattern recognition is scale-invariant by construction, mirroring the fractal claim at the heart of the theory.

Two results from this work deserve attention beyond the wave community. First, Prechter and the mathematician Sacha Sardo-Infirri published research showing the model can distinguish real market returns from randomized versions of the same data across the Dow, the Nasdaq, gold and Bitcoin. That is a falsifiable test, and wave analysis spent decades being accused of not offering any. Second, his stability argument: a form-based model is stationary across all of market history, while parameter-fitted quantitative models morph with each regime and burn out when the regime changes. Whatever one thinks of wave counts, that is a serious methodological position.

Waves out of cycles

The bridge between the schools is older than most practitioners on either side know. J.M. Hurst made the connection in 1970, arguing that summed cycles of different lengths generate exactly the wave-like structures Elliott catalogued: a long rising component with a shorter cycle riding on it produces five waves up and three down without any pattern being imposed. My own research extends the point beyond Elliott counts. Overlay the right composite of cycles and almost any classical formation falls out, head-and-shoulders included. The patterns are not the cause of anything; they are what cycle summation looks like on a chart.

As a result I treat the two models as complementary projections of the same object rather than rivals. The cycle model explains where the form comes from and supplies the clock, since a dominant cycle can be measured and its next trough projected. The wave model reads the form directly in the here and now, without measuring a single period, and tells you where inside the structure the market stands. In practice the combination is stronger than either input: a completed five-wave decline arriving in the time window of a projected cycle trough is the kind of agreement that separates a setup from a statistic, the same conditions-first logic Larry Williams argued two episodes ago from an entirely different toolbox.

The full conversation is on the FSC channel:

Elliott Prechter: Teaching a Machine to Count Elliott Waves

EWAVES: https://ewaves.com

Elliott Wave International: https://www.elliottwave.com

Foundation for the Study of Cycles: https://cycles.org

US stocks came into Wednesday on the back of a broad rally. Yesterday the S&P 500 jumped 1.79%, the Dow climbed 1.71%, the Nasdaq surged 2.59%, and the Russell 2000 added 1.85%. Treasuries gained as yields fell across the curve, helped by Brent’s 5.25% slide to around $79.40 on reports that a deal to reopen the Strait of Hormuz could arrive within days. Gold climbed 0.55%, silver rose 2.4%, and Bitcoin advanced 0.8%.

The rally had two earnings drivers, Caterpillar’s blow-out quarter and Palantir’s huge beat-and-raise, layered on top of the Hormuz headlines and a market that has decided Big Tech’s Q2 reports answered the AI bears for now. The tone has turned into aggressive chasing as the S&P sprints toward fresh all-time highs, with the jobs report on Friday and the CPI next week as the nearest tests. For our cycle work, the day belongs to a single story reaching its payoff. Three weeks ago we wrote that seven cycles were building a floor beneath a falling gold price. Today nine cycles point to the same low, the deepest alignment this scan has ever shown, price has begun to move higher behind the signal, and the entire mining-and-uranium block reaches the model’s strongest bullish reading on the same day. That is the day’s thesis, and everything below serves it.

Each day we filter roughly 45 global markets (equity indices and sectors, metals, energy, agriculture, crypto, FX, and rates) through our cycle consensus engine. The key reading is the Consensus Score, which ranges from -100 to +100 and measures how strongly the dominant cycles of a market agree on a potential turning point. Values at or beyond ±60 mark the critical zone, the range where the cycle model raises the alarm for a possible turn and a market earns a place in the tables below. Let’s take a closer look.

Bottoming cycles

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A price index can rise while most of its stocks fall. The McClellan Oscillator was built in 1969 to expose exactly that condition, and for this episode of the FSC interview series both generations behind it joined me: Sherman McClellan, who created the Oscillator and Summation Index with his late wife Marian, a mathematician, and their son Tom McClellan, who edits The McClellan Market Report and still works on it with Sherman daily. The conversation covered an origin story that is better than most people know, and the claim that gives this article its title.

Rocket science and hand-drawn charts

In the summer of 1969 every data point was computed by hand. Marian McClellan calculated the values, Sherman posted them to charts, and the mathematical machinery came from an unlikely source: P.N. “Pete” Haurlan, a genuine rocket scientist at the Jet Propulsion Laboratory who had used exponential smoothing for missile and satellite tracking and applied the same technique to market data. Haurlan’s terminology survives inside the Oscillator to this day. His “10% Trend” and “5% Trend” are exponential moving averages with smoothing constants of 0.10 and 0.05, which correspond to lengths of 19 and 39 days (the EMA multiplier is 2 divided by length plus 1). Gene Morgan, host of the “Charting The Market” television show in Los Angeles, put the new indicator on air in 1969 and attached the family’s name to it, and Haurlan’s Trade Levels firm published the McClellans’ book “Patterns for Profit” in 1970.

The construction itself is compact. Take the NYSE’s daily net advances (advancing issues minus declining issues), compute the 19-day and 39-day EMAs of that series, and subtract the slow from the fast: that difference is the McClellan Oscillator. The running total of the Oscillator is the Summation Index, the slower gauge for the larger swings.

What breadth sees that price hides

Cap-weighted indexes hide participation. A handful of mega-caps can carry an index higher while the average stock rolls over, and today’s concentration makes the effect stronger than at any point in the indicator’s history. Breadth counts every issue equally, and as a result it measures something closer to the availability of money than to the opinion of the index. When liquidity is abundant, the buying reaches even the weakest issues and breadth is broad. When liquidity drains, money concentrates in the largest names first, the advance-decline statistics deteriorate before the headline index does, and the divergence appears at major tops with remarkable consistency.

In terms of this interview series, the McClellans complete a measurement chain that Michael Howell opened in episode one: Howell measures liquidity at its source, the balance-sheet capacity of the financial system, while breadth measures its arrival at the level of the individual stock.

A band-pass filter before the term was fashionable

From an analytical perspective, subtracting a slow EMA from a fast EMA is a band-pass filter. The fast average removes the day-to-day noise, the subtracted slow average removes the trend, and what remains is the vibration between the two smoothing horizons, roughly the swings that play out over several weeks to a few months. The Oscillator was therefore a cycle instrument from birth, tuned by its fixed 19/39 pair. That fixed pair is the same design decision John Bollinger made with his fixed 20-period bands, and the same adaptation applies: measure the dominant cycle first, then set the EMA pair relative to it, so the passband stays centered as the market’s rhythm morphs. In practice, breadth data rewards this treatment more than price data does, because removing the mega-cap distortion leaves a cleaner carrier. Running dominant-cycle detection on the cumulative advance-decline line regularly produces sharper spectra than the cap-weighted index itself.

Repetition as a family business

The other thread through six decades of McClellan work is repetition. Tom’s research lives on lead-lag relationships and recurring patterns:

• commercial traders’ net positions in eurodollar futures as a roughly one-year leading indication for the S&P 500 (a relationship he introduced publicly in 2011, and one he is candid about),

• gold leading interest rates by about 20.5 months, and an 8-year cycle in gold itself.

Sherman has watched enough complete market cycles. Even the founding dataset was framed this way: before publishing in 1970, the McClellans assembled advance-decline data covering two full 4-year market cycles, because one cycle proves nothing.

The full conversation is on the FSC channel:

The McClellan Oscillator: Two Generations of Market Timing

McClellan Financial Publications: https://www.mcoscillator.com

Foundation for the Study of Cycles: https://cycles.org

Larry Williams calls himself a conditional trader, and the phrase carries more analytical weight than it first appears. Williams has been trading since 1962, created the Williams %R indicator in 1966, and won the 1987 World Cup Championship of Futures Trading by turning USD 10,000 into more than USD 1.1 million in 12 months of real-money trading, a result that still stands as the record. For this episode of the FSC interview series we talked about the part of his work that rarely makes the headline: the recurring structures underneath six decades of results.

Six decades of the same market

Williams’s continuity claim is simple. The instruments, the speed and the participants have morphed beyond recognition since 1962; the behavior has not. Fear and greed produce recurring structure, and as a result, patterns he traded in the 1960s still appear on today’s charts. For a cycle analyst this is the foundational assumption made flesh: recurrence is the raw material of the discipline, and Williams is a sixty-year sample of evidence that the material exists. The working question is never whether markets repeat but which repetitions carry information, and his answer is a hierarchy: conditions first, timing second.

The commercials know their market

The first condition is positioning. The CFTC’s weekly Commitments of Traders report splits open interest into commercials (the hedgers who produce or consume the underlying), large speculators, and small traders. Williams began reading this report in the early 1970s, decades before it became fashionable, on the logic that the commercials hold the best fundamental information about their own market.

His COT Index turns the raw report into a bounded oscillator: take the commercials’ current net position, subtract the lowest net position of the past 3 years, divide by the 3-year range, and multiply by 100. Readings above 75 mean the commercials are unusually long (a bullish condition), readings below 25 mean they are unusually short. The discipline sits in what the index is not: it is weekly data with a reporting lag, so it cannot time an entry. It tells you which direction deserves your timing tools, nothing more.

Seasonality as the calendar cycle

The second condition is the calendar. Williams built his first seasonal indexes in 1973, mapping the recurring pressure of harvests, inventory cycles, tax flows and demand patterns onto price. From an analytical perspective, a seasonal is a cycle with the length locked at 12 months and the phase locked to the calendar. The dominant cycles I measure are the free-running counterpart: length and phase estimated from the data, allowed to drift. The two are complementary rather than competing. Fixed calendar cycles supply the stable scaffold, measured cycles capture the vibration that drifts around it, and my own second book (Part II of “Decoding the Hidden Market Rhythm”, devoted to Metonic calendar cycles) argues the fixed-length case at lengths well beyond 12 months, so Williams’s seasonal conviction landed on prepared ground in this conversation.

In practice: the checklist

The framework operationalizes cleanly.

• Condition one: the commercials’ COT Index above 75 on the weekly report, which the CFTC publishes free every Friday.

• Condition two: a supportive seasonal window.

• Condition three: a projected dominant cycle trough due in the same zone.

When at least two of the three agree, the timing tools take over, for Williams typically %R turning up out of its oversold zone (below minus 80) or a volatility breakout off the open. A cycle projection standing alone is a statistic; the same projection inside agreeing conditions is a trade. That division of labor is the transferable lesson of his six decades, and it applies to every timing method in this publication, not only his.

The full conversation is on the FSC channel:

Larry Williams: Six Decades of Trading Market Cycles

Larry Williams: https://www.ireallytrade.com

Foundation for the Study of Cycles: https://cycles.org