Predicting Stock Market Using Cycle Analysis

SMAP-3 by http://www.addaptron.com is able to extract basic cycles of the stock market (indexes, sectors, or well-traded shares). To build an extrapolation (prediction), it uses the following two-step approach: (1) applying spectral (time series) analysis to decompose the curve into basic functions, (2) composing these functions beyond the historical data. It also enables finding optimal timing to buy/sell by analyzing month of year, day of month, and day of week (the calculation is based on statistical analysis). The investors who empowered by using SMAP are less likely to get fooled into buying at the worst time. The stock market has powerful and consistent cycles. They can be as a bad surprise for some investors but others know how to take advantage of the market cycles. By identifying the cycles it is possible to anticipate tops and bottoms and to determine trends. The stock market cycles can be a good opportunity to maximize return on investments. The presence of multiple cycles of different periods and magnitudes in conjunction with linear trends, can form a complex pattern of the stock market performance curve. Often cycles mask themselves - sometimes they overlap to form an abnormal extremum or offset to form a flat period. It is clear that a simple chart analysis has a certain limit in identifying cycles parameters and using them for predicting.

Category:

Science & Technology

Tags:

• stock market
• cycle analysis
• forecast
• statistical analysis
• investors
• trend
• chart
• return on investment
• performance