Saturday, August 31, 2013

2013.08.30 DJIA Cycle Chart

Historical price cycles for the DJIA have converged so that there is an unusual steep decline predicted to last until early 2014, with a target price level of 7700 +/-. The major caveat is that the Fed may continue its unprecedented policy of constructing a mirage of liquidity in the desert of insolvency. Hence, the best way to interpret this chart is that there are extremely strong historical factors pointing to a large drop in the DJIA. Whether or not it comes to pass in this time frame depends on whether the historical cycles resume on time, or whether the Fed can continue to put off the day of reckoning, with a historically low ratio of assets backing the liquidity which it has, supposedly, temporarily created via its bond buys.

Sunday, August 25, 2013

2013.08.23 VIX Cycle Chart

The VIX cycle model shows increasing volatility to a peak in the November time frame. This is not the same model as the AI pattern recognition model previously made available. It should not be used for trading of course, but it does indicate some increase in volatility during the Fall season, which is not news to followers of the VIX.