The technology behind Cycles-Trader is Neural-Networks.
One of the natural phenomena of neural networks solutions is the Inverse, in which a projection line may be in inverse direction, showing up instead of down.
Although this is a rare case in Cycles-Trader solution as we already took measures to rectify this issue as much as possible, it can appear in less than 10% of the cases, and have unpleasant results when it happens.
The example ahead is one of these rare cases, happened recently with AMD stock, which was not caught on time, and how we can still avoid it.
- the annual cycle (Green), showing uptrend in the upcoming months
- the monthly (Blue) and bi-weekly cycles show uptrend until end of July and then strong downtrend.
An strong uptrend appeared where a downtrend was expected
As clearly visible from the graph, this is the right direction.
As clearly visible from the graph, this is the right direction.
INVERSE cases may happen.
Although they rarely happen, in our experience they happen less than 10% of the cases, the results may be unpleasant.
1. Always use risk management tools such as Stop-Loss
2. When price starts to go strongly against the projection line, this is the time to stop and recalculate
3. Even with inverse direction of the projection line , the timing may still be accurate
Happy trading