Sunday, May 1, 2016

2016.04.29 VIX Cycle Model Chart

2016.04.29 VIX Cycle Model Chart

















The VIX cycle model has continued to phase shift to the right. Currently, the model suggests higher VIX values moving into Summer and Fall. A previous iteration of the model is shown below and here on the blog.





2016.03.29 VIX Cycle Model Chart

Friday, April 15, 2016

2016.04.15 XOI.X Cycle Model Chart

2016.04.15 XOI.X Cycle Model Chart

















There is a slow right phase shift in the XOI model, however, the local minimum of the index price curve continues to scrape around 1000, suggesting that much lower levels for the index are much less probable.  The previous model run is shown below and here on the blog.



2016.03.11 XOI.X Cycle Model Chart

Saturday, April 2, 2016

2016.04.01 Gold Cycle Model Chart

2016.04.01 Gold Cycle Model Chart

















Gold prices corrected consistent with the divergence seen in the previous model run shown below and here on the blog. Going forward, the model suggests a strong and increasing upward bias in prices.


2016.02.26 Gold Cycle Model Chart

Tuesday, March 29, 2016

2016.03.29 VIX Cycle Model Chart

2016.03.29 VIX Cycle Model Chart


















Coiled spring or sprung model? The next few days should decide.

Saturday, March 26, 2016

2016.03.26 DJIA Cycle Model Chart

2016.03.24 DJIA Cycle Model Chart

















The DJIA cycle model is now at an extreme divergence between actual and predicted level for the index. Note that in comparison with a run of the same model on 2015.12.31 shown below and here on the blog, a phase change has occurred, in the opposite direction I expected. The current run of the model suggests an even steeper slope down for the rest of the year, whereas the December run suggested a flat period for index prices between march and September.  Also note that I had to adjust the Z-score scale as the divergence is heading towards -2.5. This is the largest divergence since Spring, 1981; August 1946; Spring 1943; Spring, 1930; October, 1929.  The lowest Z-score for the model was -3.53 in September, 1929.  Remembering that all models are wrong but some are useful, my current interpretation is that there are extremely powerful convergent  downward cycles at play here, from yearly to decadal,  but the caveat is that central bank liquidity and forex management do not enter into the model whatsoever.



2015.12.31 DJIA Cycle Model Chart

Saturday, March 12, 2016

2016.03.12 XOI.X Cycle Model Chart

2016.03.11 XOI Cycle Model Chart

















The XOI cycle model suggests that the index may have traversed its low for the year. The multi-month phase change which has pushed the predictive curve to the right may have ended.  The high positive Z-score, as shown below and here on the blog, indicated a high chance of a positive reversal which did occur.



2016.02.12 XOI Cycle Model Chart

Sunday, March 6, 2016

2016.03.04 Silver Cycle Model Chart

2016.03.04 Silver Cycle Model Chart

















The current silver cycle model illustrates the nice reversal to the predictive curve that was indicated on the last run of the model on 2016.02.12 as shown below and here on the blog.

Notice that the difference between the actual curve and predictive curve, as indicated by a large negative Z-score suggested a reversal was highly likely.

Inasmuch as we note no evidence of a phase change for now,  I would interpret the model as indicating that a local maximum in price may occur in the May 2016 time frame.


2016.02.12 Silver Cycle Model Chart

Saturday, February 27, 2016

2016.02.26 Gold Cycle Model Chart

2016.02.26 Gold Cycle Model Chart

















The past few weeks suggest that the multi-month phase extension of the predictive price curve for Au may have finally ended.  The price curve is above the predictive curve at this juncture, which suggests some mild downward pressure on prices in the near term, but not likely a break in the overall long term rise. Post hoc one can make up a series of narratives "explaining" why this is occurring now, as opposed to a year ago.  A previous iteration of the model from October, 2015 is shown below and here on the blog.  If you compare them, it may inform your judgement regarding how useful or useless these 'wrong' models are, depending on your perspective.  I get some comments where naive individuals think that because the gold price didn't rise exactly on a particular date, the model is useless. The shortest answer I have is that they are all wrong, but quite useful to me, and to some, but not all readers.


2015.10.02 Gold Cycle Model Chart




Saturday, February 20, 2016

2016.02.19 DJIA Cycle Model Chart

2016.02.19 DJIA Cycle Model Chart

















The divergence between actual and predicted suggests that we should see a downward drift in the price curve in the March to April time frame. Going back to June of 2015, the first iteration of this model seems to be holding up fairly well, as shown below and here on the blog.


2015.06.12 DJIA Cycle Model Chart




Wednesday, February 17, 2016

2016.02.17 VIX Cycle Model Chart

2016.02.17 VIX Cycle Model Chart



















The VIX cycle model suggests that the VIX may have bottomed at this time, and that ongoing forward we should see a robust spike to the upside. In addition, I have four VIX neural net models, two of which use the Z-score as input, all of which have today also issued buy signals on the open on February 18. . So I'm sticking my neck out, with a 68% chance of success.  All models are wrong, some are useful, and some models give the odds.  A previous iteration of the model is shown below and clicking on the caption will give the original post.


2016.01.06 VIX Cycle Model Chart



 

Sunday, February 14, 2016

2016.02.12 XOI.X Cycle Model Chart

2016.02.12 XOI.X Cycle Model Chart

















The XOI.X cycle model predictive curve shows both a shift to the right from an error-appropriate phase change as well as an amplitude change. Looking at the charts below from previous iterations, the high Z-score was resolved to the upside to touch the predictive curve. Because the predictive curve has a positive slope going forwards, any continuing phase shift is not likely to be associated with a major amplitude change to the negative. I would interpret this as another data point supporting the premise that XOI.X is not likely to go much below 800 going forwards.  And finally, remember that all models are wrong, but some are useful.  The previous charts can also be accessed by clicking on the captions.




2016.01.11 XOI.X Cycle Model Chart


















2015.12.14 XOI.X Cycle Model Chart







Saturday, February 13, 2016

2016.02.12 Silver Cycle Model Chart

2016.02.12 Silver Cycle Model Chart
















The silver cycle model suggests silver may have found a bottom for the immediate time frame. The actual price has deviated from the predicted price enough so that according to the model, silver prices should experience a negative correction on the way to a local maximum of ~$16 in the May time frame.
Below is the previous iteration of the model, also shown on the blog here.


2015.12.18 Silver Cycle Model Chart












Saturday, February 6, 2016

2016.02.05 Gold Cycle Model Chart

2016.02.05 Gold Cycle Model Chart

















The phase extension that has been ongoing for the past year in the gold model may have ended. There are robust yearly and decadal cycles all adding up to a gradual rise in gold price for the rest of 2016.  A previous iteration of the model is shown below and here on the blog.


2015.06.05 Gold Cycle Model Chart



Sunday, January 24, 2016

2016.01.22 DJIA Cycle Model Chart

2016.01.22 DJIA Cycle Model Chart

















According to the cycle model, downward pressure on the DJIA will continue until the mid-February 2016 time frame. A previous iteration of the model is shown below and here on the date it was posted.

2015.06.12 DJIA Cycle Model Chart








Saturday, January 16, 2016

2016.01.15 Gold Cycle Model Chart

2016.01.15 Gold Cycle Model Chart


The gold cycle model continues to phase shift forwards, also dragging the timing of the predicted bottom forward. Nevertheless, the model continues to suggest that the $1000 level will likely not be breached during the phase extension, if it continues. The previous iteration of the model is shown below and on the blog here.

2015.112.04 Gold Cycle Model Chart

Monday, January 11, 2016

2016.01.11 XOI.X Cycle Model Chart

2016.01.11 XOI.X Cycle Model Chart


















Over the past couple of years, this has been a reasonably well-performing model. Currently, based on historical cycles, it is suggesting a very strong upward bias in the index. Looking at a run from about a year ago appearing below, posted in February of 2015, one can see that the timing of the minima of the predictive curve has extended forwards by about four months, which is well within the error of the model.



2015.02.06 XOI.X Cycle Model Chart

Saturday, January 9, 2016

2016.01.08 DJIA Cycle Model Chart

2016.01.08 DJIA Cycle Model Chart


















The DJIA cycle model continues to suggest lower prices for the index moving forward in 2016. Note the high Z-score in the previous iteration shown below. The model was first run in June, 2015 as shown below and on the blog.



2015.12.31 DJIA Cycle Model Chart


















2015.06.12 DJIA Cycle Model Chart

Wednesday, January 6, 2016

2016.01.06 VIX Cycle Model Chart

2015.01.06 VIX Cycle Model Chart


















The VIX cycle model continues to suggest an increase in baseline volatility over the next three months. It may have occurred by chance, but it is gratifying to see the DJIA cycle model is also aligned with increasing volatility.  Two previous iterations of the model are shown below and have been posted on the caption date on the blog.  Yes, I'm feeling lazy so I don't want to fuss making the links!


2015.12.18 VIX Cycle Model Chart
















2015.11.13 VIX Cycle Model Chart

Thursday, December 31, 2015

2015.12.31 DJIA Cycle Model Chart

2015.12.31 DJIA Cycle Model Chart

















The DJIA cycle model continues to suggest lower prices through 2016. A previous iteration of the model is shown below and on the blog.

My best wishes to all readers for 2016.


2015.06.12 DJIA Cycle Model Chart

Sunday, December 20, 2015

2015.12.18 Silver Cycle Model Chart


2015.12.18 Silver Cycle Model Chart


















The silver cycle model suggests a bottom of ~1325 in silver price in March, 2016. Recently, the model is capturing the local minima and maxima of the price curve with a lag time of a few months. This should inform our interpretation of the model going forwards. A previous iteration of the model is shown below and previously  here on the blog.



2015.10.09 Silver Cycle Model Chart




Saturday, December 19, 2015

2015.12.18 VIX Cycle Model Chart

2015.12.18 VIX Cycle Model Chart

















The VIX cycle model continues to suggest a rise in the index which accelerates at the beginning of 2016. A previous iteration of the model is shown below and on the blog.



2015.11.13 VIX Cycle Model Chart

Monday, December 14, 2015

2015.12.14 XOI.X Cycle Model Chart

2015.12.14 XOI.X Cycle Model Chart

















The Amex oil index cycle model suggests that the recent decrease in the index price is temporary, and there is very strong upward pressure on prices. It is possible that the index has still to hit the low, but that possibility is low if the model is valid. Last time in mid-August where this much divergence occurred between actual and predicted price, the price reverted back to the predictive curve 'attractor.' A previous iteration of the model is shown on the blog and below.



2015.11.20 XOI.X Cycle Model Chart

Saturday, December 12, 2015

2015.12.11 DJIA Cycle Model Chart

2015.12.11 DJIA Cycle Model Chart

















The DJIA cycle model continues to suggest downward pressure on the index, predicting a DJIA index of 15500 by the end of 2015.  Previous iterations of the model are shown below and on the blog.



2015.10.08 DJIA Cycle Model Chart












2015.06.12 DJIA Cycle Model Chart


Sunday, December 6, 2015

2015.12.04 Gold Cycle Model Chart

2015.12.04 Gold Cycle Model Chart


















The gold cycle model suggests robust pressure for higher prices in the index going forwards. In fact, it suggests we may be at the cusp of a secular rise in gold prices, if the model is correct. The model has plenty of error, and the phase extension over the past few months has been disappointing because we are approaching the point where further divergences will likely not be tolerated by the model structure, and the result will be non-convergence on a model run. The model has reached these high levels of divergence on only four other occasions since 1968.  A friend of mine who has a full time job in the commodity markets tells me that the gold COT figures are quite astounding in terms of the number of speculator short positions at the present time. Historically these extreme positions by speculators always resolve to the upside.  Remembering that all models are wrong but some are useful, a short position in gold at this time would seem to be, on a historical cycle basis, a very very risky trade.  All previous iterations of the model can be found on the blog.