The Gann Decennial Cycle points to some kind of resolution in May.
May 2018 is 10 years (120 geometrical months) from the May 2008 pre-crash pivot high.
A reaction was due this year after the DJIA tagged the upper rail of a trend channel in January.
The reaction occurred in concert with an overthrow of a trend channel on a weekly and daily basis (red trendline).
The decline tagged the bottom rail of the monthly trend channel in April on the 3rd month from high.
This is important because not only did DJIA test of the lower rail of the channel creating a 3rd higher low, but 78% of corrections are over by the 3rd month.
So this is another reason May sets up as a potentially important resolution, as walked through in Monday's morning report.
In addition to the Gann Decennial Cycle, there are several major time/price square-outs based on the Square of 9 Wheel in May. For example, this May is the 226th anniversary of the NYSE on May 17 in 1792 and the start of WW2 79 years ago.
We will show these relationships in tomorrow's report.
Each May, the bromide, 'Sell In May and Go Away' gets ink, but these pundits typically fail to analyze which phase of the cycle we may be in and what current structure is.
For example, this May finds the DJIA/SPX poised to rally out of a 3 month contracting triangle or to break the bottom of a monthly 3 point 28 month trend channel.
Interestingly, oil broke out of a consolidation on Friday and looks set to rally to 73 plus which is 50% of the 147 all-time high which occurred 10 years ago in MAY.
(Click here to enlarge)
At the same time, the SPX pre-crash pivot high in 2008 occurred at 1440 on May 19.
Notably 1440 aligns exactly with mid-May.
There is also a 7 year or so natural Gann Cycle which hits this mid-May..png)
(Click here to enlarge)
Conclusion.
Whatever happens this month will have far-reaching ramifications for the next 3-4 months and longer.
Tomorrow in the Daily Market Report, we'll discuss the historic big picture cycles that are about to hit. Check out a trial below to trade the changing market alongside us:
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