Why The Federal Reserve Elected to "Talk Up" the Economy and Therefore the Markets this Week.

Below is a five year weekly OHLC chart of the DJX, the 1/100TH of the Dow Jones 30 Industrial Average.  This chart highlights Key Presidential Cycle EchoVectorVEST EchoVectors and 4-year EchoBackDates in 2008 for the current 2012 market year. It also includes some key annual EchoVectorVEST EchoVectors and 1-year EchoBackDates in 2011 for the present 2012 market year which are currently in force (as a result of 'follow through' to key 2010 EchoVectors and 1-year EchoBackDates to the 2011 market year.

The chart is very revealing.  "In pink" notice the current PCEV and PCEVEBD period we are currently entering.  Also notice the current key AEV and AEVEBD, and last years springtime upward momentum finish we are currently entering  "in short-line aqua-blue".  Also note 'in solid horizontal green' notice the 'price equivalency basis recovery level' we have now achieved on the PCEV for this week.

In red and green 'spaced-lines' are illustrated various PCEVs and PCEVEBDs that came into play in last year's "spring and summer price level swoon" on the PCEV basis, and their 'pivotings' through quarters.  The 'co-ordination' of these highlighted and key PCEVs and PCEVEBDs (on the weekly OHLC charting basis) is quite remarkable, especially regarding various near-term relative strength and relative weakness 'price echoes.'

It was not in the Federal Reserves current monetary expansion policy and therefore "accounting unit value amplification and magnification efforts" to see a precipitous conclusion to the upward price momentum and 'wealth effect' on the Presidential Cycle and Annual Cycle basis this week, so talking up  the market at this key critical juncture and level ensued.

However, will 'talk' be sufficient to prevent the powerful  market forces of these cycle price cycles and echovectors from fulfilling themselves going forward from this week on a PCEV and an AEV basis, especially with all the uncertainties in politics, geopolitics, macroeconomics, and employment currently being considered.

 Full Net Portfolio Current Price Level Insurance (FNPI) may be considered particularly timely, on a risk-reward basis, now, and going forward into May 2012... and beyond.

EchoVectorVEST Lexical References:

PCEV           Presidential Cycle EchoVector
PCEVEBD   Presidential Cycle EchoVector EchoBackDate
AEV             Annual Cycle EchoVector
AEVEBD     Annual Cycle EchoVector EchoBackDate

FNPI            Full Net Portfolio Insurance (Price Level Hedge)

DJX: 1/100TH of the Dow Jones 30 Industrial Average

5-Year Weekly OHLC

Key Presidential Cycle EchoVectorVEST EchoVectors

Key 4-Year EchoBackDates

Key Annual EchoVectorVEST EchoVectors for 2012 and 2011.

Key 1-Year EchoBackDates for 2012 and 2011

(Click on chart and click again to enlarge and zoom)

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Divisions of Motion Dynamics and Precision Pivots
Bradford Market Research and Analytics

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