Cyclic Support and Resistance Lines are price levels that are likely to provide support in declining markets and resistance in rising markets. Cycles will often top and bottom around these lines, sometimes months or even years after the support or resistance line has been established.
Once a Support/Resistance level has been established, the same line can offer support in a declining market and resistance in a rising market. For example, declining prices may temporarily congest around a support level before it is finally penetrated to the downside. But when prices try to rally back up again, the same line may offer resistance to the rising market.
The strength of Support/Resistance levels is determined by how often prices have rebounded or become congested at these levels. Generally, the longer the cycle, greater is the effect of support or resistance. Cyclic Support/Resistance Lines are most effective when constructed for Daily Cycles, Intermediate Cycles, Seasonal Cycles, and other Long-term Cycles Support/Resistance lines some time to test its congesting and rebounding power before anticipating its effect on future price movement.