PRODUCT REVIEW: Market Cycle Dynamics by Dennis D Peterson
Market Cycle Dynamics software for MetaStock (Mcd) is the creation of David Knox Barker and is based on years of cycle research. Barker studied cyclist P.Q. Wallís methods and discussed cycles with him for many years, but has gone beyond Wall for finding price targets. Wall would have developed price targets by dividing a prior price range into equidistant thirds. Barker makes extensive use of Fibonacci ratios to find pricing targets. Mcd is basically a standalone product but uses MetaStock 11 for quotes. Itís not the typical plug-in product because thereís some explanation needed for installation, but letís get to the good stuff.
Mcd uses a three-pronged approach to analyze market behavior. It attempts to predict price (Fibonacci based) and time targets (based on Kondratieff, Kitchin, and Wall cycles) along with generating buy/sell signals. The buy/sell signals come from Barkerís choice for sentiment: the stochastic oscillator. Compared to price and time prediction, the use of the stochastic oscillator for sentiment is straightforward. The preferred choice for daily %K periods is a Fibonacci number, such as 8, 13, or 21. Price and time targets need some explanation, and it should also be said that Barker has found that large-cap, high-volume equities work best. The other two approaches need more explanation, so letís start with pricing targets.