Boatman I am in this forum because I want to get either a rejection or confirmation of my findings that cycle analysis doesn't work well as a basis of mechanical trading systems. Also I want to hear some objective arguments about the subject and would appreciate if you can provide such.

My intention and my whole approach to trading is absolutely result driven, I don't want to defend or reject a method just because I like or I don't like it, it is all about the results it can produce.

In a quite early stage of my development as a trader which started 6 years ago I have read Ehlers' book "Cybernetic Analysis for Stocks and Futures: Cutting-Edge DSP Technology to Improve Your Trading" and was very exited about the approach presented there (in my opinion this is the key book of him, no other comes close). The math foundation is solid and easy to follow. But nevertheless, I was not able to find any evidence that the cycle analysis methods provide a systematic advantage in trading over a longer period of time and that the small advantage fully vanishes in extreme market conditions. As you know, Ehlers' himself was not able to provide a proof that his methods provide a true advantage. Fact is that he runs various companies, one of which is StockSpotter.com and here are their results (they even don't provide details to see key measures like Sharpe, profit factor, dd): http://stockspotter.com/In/SystemPerfByMonth.aspx
Well, it is obvious that a simple buy and hold approach has outperformed their methods by a factor of magnitude.

So if Ehlers himself didn't manage to get better results, who else did?

Here is again what I can say about it:

The predictive capability of cycle analysis depends on the stability of the cycles which you have discovered in the past. You find stable cycles and therefore perfect conditions for signal processing in communication, multimedia and electronics but not the case in the financial markets. You can very well analyse the past but you cannot carry the result on into the future.