PonziUnit
06-11-2011, 01:42 PM
Fractal and slope similarities:
It started out when I noticed that the 3 consecutive lower lows including 10/7/66, 5/26/70 and 10/3/74 are at the same descending slope as the 2 consecutive lows from the 90's bear. My theory is that the expanding bearish wedge is the shape of default rolling defaults shaped by intervention.
Using the frame of time:
In the 70's the 3 lows were roughly 4 years apart. So far in the 90's with 2 lower lows in place and every bear expecting a 3rd, the time span is roughly 7 years apart. For comparison purposes, I had to pick a high point, or a start for each of the bear markets and for that I used where price intersected the red channels marked in 1964 and 1997. The red channel gives the fractal comparison of the 60's bear and the 90's bear consistent starting points as they are both based on the same channel. It seems to me that if we are indeed echoing the 70's it's on a larger scale and so far that scale is approximately a 4 to 7 ratio using the frame of time.
Using the frame of price:
The first top in the 70's (roughly) 94 dropped 33% to the low of 73. Second top 108 dropped 37% to 69. Third top 119 dropped 48% to 62.
The first top in the 90's, 1552 dropped 51% to 768. The second top from 1576 dropped 57% to 666.
The scale of the drop off the tops is larger in the 90's but so is the time span between these drops.
If this bear market as measured by the fractal continues to rhyme (using the 4:7 time ratio) with the 70's bear market then it would extend out till 2016. _IF_ there is going to be a third low to this 90's bear market and _IF_ it is also kept on the same scale then it projects a final bottom somewhere along that uppermost red channel line and the lowest price for that intersection of the channel would be approximately 421 in November of 2016.
If somehow price sunk down to that channel all in this week it would put the low around 620 but because price destruction has all till 2016 to accomplish this rhyme with the 70's bear, I've got my ultimate bottom from between 600-421 between now and late 2016.
If price does drop to that red channel then that puts in a huge head a shoulders formation and I think it's similar to McHugh's projections of head and shoulders signaling prices to zero. Actually, if prices broke below 420 I'd have the target between 100-50 but I don't think that happens.
Regardless, over time the market has experienced many substantial declines and if what we just had was a multi-year top, we've likely got a low at 30-60% more downside from where we are right now through 2016. Not saying it has to happen but if we do go down to retest or break below the lows between now and 2016 it should be seen as typical of historical market performance.
:bear_pinch:
It started out when I noticed that the 3 consecutive lower lows including 10/7/66, 5/26/70 and 10/3/74 are at the same descending slope as the 2 consecutive lows from the 90's bear. My theory is that the expanding bearish wedge is the shape of default rolling defaults shaped by intervention.
Using the frame of time:
In the 70's the 3 lows were roughly 4 years apart. So far in the 90's with 2 lower lows in place and every bear expecting a 3rd, the time span is roughly 7 years apart. For comparison purposes, I had to pick a high point, or a start for each of the bear markets and for that I used where price intersected the red channels marked in 1964 and 1997. The red channel gives the fractal comparison of the 60's bear and the 90's bear consistent starting points as they are both based on the same channel. It seems to me that if we are indeed echoing the 70's it's on a larger scale and so far that scale is approximately a 4 to 7 ratio using the frame of time.
Using the frame of price:
The first top in the 70's (roughly) 94 dropped 33% to the low of 73. Second top 108 dropped 37% to 69. Third top 119 dropped 48% to 62.
The first top in the 90's, 1552 dropped 51% to 768. The second top from 1576 dropped 57% to 666.
The scale of the drop off the tops is larger in the 90's but so is the time span between these drops.
If this bear market as measured by the fractal continues to rhyme (using the 4:7 time ratio) with the 70's bear market then it would extend out till 2016. _IF_ there is going to be a third low to this 90's bear market and _IF_ it is also kept on the same scale then it projects a final bottom somewhere along that uppermost red channel line and the lowest price for that intersection of the channel would be approximately 421 in November of 2016.
If somehow price sunk down to that channel all in this week it would put the low around 620 but because price destruction has all till 2016 to accomplish this rhyme with the 70's bear, I've got my ultimate bottom from between 600-421 between now and late 2016.
If price does drop to that red channel then that puts in a huge head a shoulders formation and I think it's similar to McHugh's projections of head and shoulders signaling prices to zero. Actually, if prices broke below 420 I'd have the target between 100-50 but I don't think that happens.
Regardless, over time the market has experienced many substantial declines and if what we just had was a multi-year top, we've likely got a low at 30-60% more downside from where we are right now through 2016. Not saying it has to happen but if we do go down to retest or break below the lows between now and 2016 it should be seen as typical of historical market performance.
:bear_pinch: