(binned per thread starter’s request) Forex Specific Time Cycles

I would like to start up a discussion on objective repeating cycles easily found in Forex.
They are based on fundamental reasons, and can be easily identified without discretion by using time and date.
And might be of great use for intraday traders.

The forex trading week opens up at 00:00 Gmt with the Sydney session opening bell. Than it is followed by Tokyo session. Afterwards the London opens, followed by the New York which ends at the next begging of the Sydney session. This is a continuous repeating pattern of each day. The trading week closes on the New York close.

The day can be segmented by session opening/closing times. Each segment usually has a standing out characteristic of its own. The Sydney and Tokyo sessions for example usually show ranging markets with low volatility. While after the close of Tokyo there is an increase with volatility, which is especially happening around the London and New York opening times.

Have you had experience taking trading decisions based on the following cycles ? Or perhaps your whole methodology is based around them ? Futhermore I would be very happy to learn if someone is aware of other cycles. I also heard that option's expiry times have influence on the forex markets, however didn't look in to it yet.

Hello, MaxenshteinD.
There are a lot of cycles out there.
There are Housing Cycle, Business Cycle, War Cycle. Grand super cycle, Astrological Cycles(Planets Cycles,Eclipse...etc) to name a few.
Most Cycles I've encountered takes days or years though.
Maybe there is even a cycle not known and haven't been discovered yet.

Here is a Lunar Phase Cycle. Silver is New Moon. White is Full Moon.
It kinda alerts you of a possible turning point or big continuation of recent trend when added with other technical analysis.

If you are looking for a cycle within the day for intraday trading.
The only thing I've found within my short research time is the Circadian rhythm of humans.
https://upload.wikimedia.org/wikipedia/commons/thumb/3/30/Biological_clock_human.svg/2000px-Biological_clock_human.svg.png

I tried to apply it using the start of the day. Or my broker's time of 00:00.
I look for possible turning points on those times.

Here is a picture of EURUSD today.


Turquoise vertical line is the start of the day for my broker. Silver lines are the times I incorporated using the Circadian Rhythm of humans in 24 hours.
If you look closely, the time lines will sometimes have big candles or near reversal points for the day.
You can apply this to any pair and look at those times and see if it does have big candles on those time or near reverse points.

I partially agree with you, but it is a bit more complicated.

Rather than trying to trade during a certain market's open hours, you should consider trading only when the market for either of your currencies is open. If you trade EUR/USD, then you should be trading London and NY. If you trade USDJPY, then you should be trading Tokyo and NY. If the banks that move your currency are not open, the volatility will be low. Additionally, news releases are typically done when the banks for that currency are open, or more truthfully, the government of those banks that releases the data is open.

Understanding this might change your perspective on market cycle times? But yes, each one does seem to have its own characteristics too, which is likely based on the market maker awake during that session. In the past it seemed to me that Asian sessions triggered more often to 4HR signals, while London and NY were more aligned to 15M, unless it is flat and in whipsaw, in which case it is a 30M chart. Of course, this varies, but it just seems the probability is higher when referring to those time frames.

I trade intraday cycles, or swings, based on technical analysis. In tight ranges, I use my preferred time frame for signals. In breakouts I use a higher time frame for the exit. While it is true sometimes that a market open will change direction of the pair, it is not always the case. If that were true, anyone could trade and profit. At times the market open starts the good cycle, while other times the market close does it. Sometimes news does it, sometimes it does not. In my experience it is good to consider a different market might change direction, but I prefer to just follow the math and not make market hours a trading signal. Good Luck with your idea.

lechugas,

you should take into consideration that Full Moon and New Moon data are not indicating turning points as mentioned in post #2.
Perhaps you have found this in the latest Pesavento book.

Sixer

Thanks for the replies
Im really busy the following days unfortunately, but I'l share the way I look at and use cycles personally soon.

I've heard of a technical study that called for a concept of cycle brackets. Maybe you might want to look that up and see more what it's about. From what I understand it involves finding a cycle and then using a technical overlay with brackets to pinpoint peaks and troughs. Not my cup of tea but you might find it interesting.

@Sixer You are absolutely right that it doesn't necessary say turning points. To be accurate, critical time levels is what I have to say.

Circadian Rhythm of GBPUSD today.

You can see those blue time critical levels for the day
I sold at the top and bought at the bottom.



Anyways, I'm going to do more cycle research.
Hopefully, I can find a weekly one.

Absolutely right, I am agree with you. But I think it is little bit complicated then trying to trade during market’s open hours. But every trader should trade when their currencies are open. For an example if your trading pair is EUR/USD then you should trade only London and New York. The volatility will be low when your trading currencies are not open which bank is moving. When the banks for your currency are open only then typically news releases are done.

lechugas,

if you want to realize an intraday cycle count, you should use the STD (Short Time Delta) cycle.
It is 4-calendar day cycle (it runs over the weekend too) and has 12 turning points plus inversions.
The cycle starts at the orange day. See an example for the EURUSD from june 2017.

Take into consideration that you have to do a lot of homework before you can use it proiftably.

Sixer

Thanks for the information Sixer. I will definitely add this to my trading analysis and see how it all plays out Thanks a lot!

gann said to square price with time

did he intend to say

"longpath/straight path = eta"

this is intriguing>>>

https://www.forexfactory.com/showthread.php?p=10031481#post10031481

no indicator yet exists as far as i know.... but its pretty simple to draw a line through price for the straight path then what to with the long path would have to be tested.... just an idea...others have claimed that pi cycles are good to use

this post has some links to Pi cycles >>>>

https://www.forexfactory.com/showthread.php?p=10036538#post10036538

just sharing FWIW

i dont claim to be any kind of expert about it

Excuse my late reply, I was thinking of the best way to describe what I look for in cycles. And I wouldn`t be surprised if most of you already know this, or even trade it.
However here it is :
We must define the Start (A) and the End (B) of the cycle. In the thread`s context the (A) and (B) must be defined by time.
For example for the intraday cycle. The (A) is at 00:00 start of the current day, and (B) is at 24:00 the end of the current day.
Now we have a predefined (A) and (B). You can draw them as vertical lines.
You record the opening price at (A) [which by the way just for the following example will be an exact Daily D1 candle]
Now the opening price of your cycle would be your major reference point.
What information can you derive from the reference point of ours ?
The price will move away from the reference point 90%< of the time.
If the price is above the ref. point than the bullish dominance is stronger.
If the price is below the ref. point than the bearish dominance is weaker.

Now through out the cycle (A)-(B) the price will keep doing one/two/all of the following things :
The cycles Maximum and Minimum price (High and Low) [just like in the daily bar d1, as a matter of fact look at the cycle as if it was an ohlc bar], will :
1) Be declined [Breakout], as in price will move higher than the previous maximum of the period/price will move lower than the previous minimum of the period.
2) Be accepted [Retrace], as in price will stop and reverse at the edges of the ohlc.

Now that is just the main structure.
Another thing might be said: There will be different ways the price moves from (A) to (B). Some will have more than others, some will happen less, however only one of them will happen.

1) The price will shoot away from the reff. point in a clean vertical/diagonal trend only in one direction (above or below the ref. point.). [For the current example observe the intraday activity from m15/m30/h1]. In this scenario even though the edges of the cycle will be accepted upon completion of the highest/lowest swing. The cycle will keep on declining the edges, and updating them.

Having said that, there is also a higher probability that if the bullish trend has unfolded, the Low (first extreme) was made and accepted first and left untouched through out the cycle. While the High was made last.
The opposite goes for a bearish trend.
Further more there is a higher probability that the first extreme was made early on in the cycles lifetime.
And even further more, there is a great probability that if the bullish trend cycle had a relatively huge Ref. point-Maximum area. Than the Ref. point-Low area was extremely relatively small.

2) However most often the cycles will be oscillating whipsaws. As in the price will simply cross the reference point in zigzags through the cycle. And have nearly same Ref. point-Maximum and Ref. point-Low areas.

3) Some cycles would be a mix of the two of the above though. How does one define a strong bullish cycle for example? The more times, the Ref. point-Maximum is bigger than Ref. point-Low. The stronger the bullish cycle is. Once again opposite for a bearish cycle.

That`s pretty much all I know, and I`ve would be glad if someone could add something on to this. Since I`n expanding on the topic I`m risking that all of the following (a few years of work) would be simply packed in a nice package and sold by some guru-wanabe... However hopefully it would be considered as b.s.

Now having said all of the above. Please take a look at the screenshots of different cycles you`ve shared and see if it makes any sense

Haven`t read his book, however heard of his opening price principle.


Some of those especially closer to the right seem magically on spot

I`ve tried searching around however couldn`t find anything unfortunately. It seems to me though that its similar to my approach.

The time cycles in the manner you present them (my understanding) are no different from the usual OHLC bars, I don't see much use in reinventing the wheel. Here are my thoughts anyway.

Like VEEFX highlighted somewhere (why do brokers all have time offsets?..a question like that), forex is decentralized and segregated, therefore every one sees a OHLC (time cycle) chart as presented to him/her by his/her broker. So before you delve into any cycle.

Your RULE #1 has to be, that the cycle is "Universal" across all brokers and locations. Everyone must see the same thing to reduce subjectivity.

As providence will have it, we have such in "Market Sessions" --- I once made market session candles and even went as far as trying to Isolate them and make a chart of say only NY bars to do further analysis. Ultimately lost interest though. Good luck.

cycle = something that repeats

cyclical refers to repeating

for example tie a ribbon onto a unicycle wheel....a unicycle's wheel hits the ground as you are riding...so the ribbon will be on the ground at point t in time...then as the wheel goes round, the ribbon will turn up to its highest high and then return back to the ground...in a cycle


if you could identify cyclical behaviour of the forex market, you could trade it with predictable outcomes...because the wheels are always turning

each currency is its own unicycle in the circus lol if one currency gains another one weakens...

so, using Piccycles makes sense since we are talking about how the market goes in circles lol

Hmmm..It was in a book I read about technical analysis one time. I can't remember the title, but I found some links that may help that are cycle related...

https://www.forexfactory.com/showthread.php?t=223846&page=2

http://stockcharts.com/school/doku.php?id=chart_school:chart_analysis:cycle_lines

Hope that's helpful.

I agree that the time must be objective, and universal.
Personally I just use Ic Markets who open an close their daily candle on the Sydney open. I was also looking in to making market session candles, and trying to look at some sessions in pure isolation. However my research carried me away in to more theoretical ways, rather than practical. Im still trying to gather as much golden nuggets from forums as possible, however soon I will be left with nothing but myself.

Sorry but all your ideas will not work or will be useless before you decide which time frame/cycle you intend to trade !

In post #10 i have shown the Short Term cycle solution for the EURUSD: The 4-calendar days cycle with 12 turning points plus inversion.

Here are 3 other cycles for this underlying:

- Intermediate Term (blue): 10 Turning points plus inversions in 4 full moon months
- Medium Term (red): 8 Turning points plus inversions in one year
- Long Term (black): 15 Turning points (no inversions) in 4 years.

Other underlyings (indices, commodities) have other solutions.

Sixer

Thanks allot once again for your insights, can you guide me towards where I can learn more about Short Term Delta Cycle (4Day STD) ?
I`ve tried searching around google, found a few websites. But still was unable to find a calendar for those 4day cycles.
Would really appreciate your help