Pullback Cycles

Doing a very basic review of all the pullbacks since we bottomed in March 2009, they generally fall into 3 categories.  They are divided by the length of time.

1.  The 5 day pullback.  This is a quick flush out of excess and provides little predictive powers for future pullbacks.  If a pullback can go beyond the 5-6 trading day period, it has enough strength to go on for 13 trading days.  Examples:  May 2009, late Aug 2009, July 2011, November 2011, June 2012, July 2012, December 2012, February 2013, April 2013

2.  The 13 day pullback.  There were not many pullbacks between 7 and 11 trading days in length.  It is almost a quantum division of pullbacks, short, quick ones that last 5 days, intermediate ones that last 13 days.  By the way, these numbers are +/- 1 day.  So 4-6 day short pullbacks, or 12-14 day intermediate pullback.  Examples: October 2009, January 2010, June 2010, August 2010, November 2010, March 2011, April 2012, August 2013, Sep-Oct 2013, 

3.  The 22 day pullback.  The last group is the deep pullback, which is less common, and last usually around 21-23 trading days.  Examples, July 2009, May 2010, May-June 2011 (hybrid of 2 and 3), late July - October 2011(two consecutive 22 day pullbacks), May 2012, October 2012, May-June 2013.

One would figure there would be a lot more 5 day pullbacks and 13 day pullbacks than 22 day pullbacks, but there isn't a big difference.  

Right now, it looks like we are either in the 13 day or 22 day pullback, because this one has gone beyond 6 days.  That means we should see another selloff this week.  I will be looking to short any bounces this week.  But I will not be doing any shorting beyond this week.