You will come across specific terms in these notes (FLD, VTL, and so on). Rather than explain them each time, you will find definitions here: guidance notes for Hurst cycles terminology
Nifty 50 futures – in 20 week cycle peak zone.
Broad brush stroke, the Indian stock market is in a 20 week cycle peak zone and we are expecting a retrace. The next meaningful longer term trough is that of the 20 week cycle due next April. This implies a top out and then pretty much a pullback for more than a quarter. We will start stalking a confirmation of the peak on shorter timeframes.
Meanwhile, there are a few other technical considerations that support the meaningful peak idea:
(1) Stretched to the upside: +2 standard errors above a regression channel plotted from the June 2022 low (left side of chart) is 21,311 which is only 1.67% higher than current price. Markets “like” mean reversion.
(2) Equality: the first big leg up versus the current big leg up (pink arrows) are more or less matched in length (1.36% difference so far). Markets “like” equality.
This post was first published on Hurst Cycles Notes.
