Economic Cycles

Economic Cycles

Technical Indicators, Price Action, Chart Signals

Economic cycles, also known as business cycles, refer to the recurring phases of expansion and contraction in an economy over time. These cycles typically include four stages: expansion (growth), peak, contraction (recession), and trough. Understanding economic cycles helps investors, policymakers, and businesses anticipate changes in markets and make informed decisions.

Use Case: A strategic investor tracks economic cycles to rotate capital from growth assets like $ETH during expansions into defensive assets like $KAG during contractions, maximizing returns while preserving wealth across macro phases.

Key Concepts:

• Opportunity Cost — Weighing potential returns against cycle-aware positioning.
• Expansion Phase — Period of economic growth, rising employment, and increasing asset prices.
• Contraction Phase — Economic downturn characterized by declining output and market corrections.
• Peak & Trough — Turning points that signal transitions between cycle phases.

Summary: Economic cycles provide the macro framework for understanding market rhythms and capital flows. By recognizing these patterns, investors can position themselves strategically across different asset classes, timing entries and exits to align with broader economic momentum and preserve generational wealth.