Economic Cycle

tspoonfr

Hi,

I am new to daily trading and understand there are basically five cycles for the economy:

1) EARLY EXPANSION
2) MIDDLE EXPANSION
3) LATE EXPANSION
4) EARLY CONTRACTION
5) LATE CONTRACTION

Is there anyone out there an can clarify this and inform me what cycle we are currently in, within the UK stock market.

Much appreciated

Etccarmageddon

I thought we're just in "Bust"

tradetime

I have always viewed it as;
1) Growth (Expansion)
2) Peak
3) Recession (Contraction)
4) Trough
5) Recovery

The UK as per recent GDP figures still appears to be in recession, though these figures often lag and we never really know until some time after the event, thus we could already be in the "Trough."
By your cycles I would say we are in "Late Contraction"

If by

I am new to daily trading

you mean Daytrading, or even very short term Swingtrading, none of this is of any relevance.

tspoonfr

Hello, thanks - if it helps maybe I should have said buying shares on a daily basis (apologies)

So would the answer be the same - i.e. phase 5 - Late Contraction

gozomark

5, possibly 1, for the economic cycle. For the UK stock market, we are 2. possibly 3.

turbobob

Regarding what cycle we are currently in within the UK stockmarket the market is well ahead of the real UK economy which is officially still in a recession. There was an interesting interview with Blanchflower (ex MPC member) today who comments that "this stock market looks awfully like a bubble to me again". But that is just the opinion of one economist... He was also talking about the possibility of the BOE being forced to extend the QE program, which means injecting more liquidity, maybe having the effect of inflating the market further.

dunstonh

gozomark wrote: »

5, possibly 1, for the economic cycle. For the UK stock market, we are 2. possibly 3.

i would say its a number between 1 and 5