Apophenia as an apologist for clairvoyance in the capital markets. - page 3
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The fractal structure of the Dow Jones Index time series from 1896 to 1932 on the eve of the Great Depression.
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Fractal analysis should begin with an analysis of a chart with a timeframe of at least one year.
The pictures above showed that the dynamics of AT&T will take place within the formation of a fractal, which is indicated by the olive colour. The AT&T chart above is plotted with a time frame of 4 months, meaning one Japanese candle represents an interval of 4 months and three candles represent 1 year.
To understand why the future dynamics of the Dow Jones index in the next 3-5 years will be downward, we need to analyze the fractal structure of the chart which is built taking into account all historical data.
and if we're wrong, we'll admit in 20 years that we're wrong....:-) and skin the hamsters now
"analytics, that's the way it is".
Dynamics of Dow Jones index on the eve of the Great Depression in 1929.
The analysis of the fractal structure of the chart of the Dow Jones Index in the time interval (1896, 1929) shows that a 3rd order fractal F111 which is the 1st segment of the 2nd order fractal F11 was formed in this interval.
This fact shows that the growth of index values in the time interval from 1896 to 1929 finished and the uptrend should be replaced by a downtrend within the framework of formation of the 3rd order fractal F112, which is the 2nd segment in relation to the 3rd order fractal F111.
In case of normality of external impacts, the 3rd order fractal F112 with 4th order segments F1121, F1122, F1123 should be formed in the form of basic fractal-attractor F22, whose time and cost intervals should make up 61.8% of time and cost intervals of the 3rd order fractal F111.
In this case, the downtrend of the values of the Dow Jones index must end at 160 points in 1949.
However, due to the unfavourable situation in the USA economy within the framework of the formation of the 3rd order fractal F112 the downtrend was strong enough to decrease the value of the index to around 40 points by 1932.
The 3rd order fractal F112 was formed with time interval T112 (1929, 1932) and value P112 = 339.95 points in the form of a mono-segment.
Completion of the 3rd order fractal F112, which is the 2nd segment of the 2nd order fractal, completed the downtrend. This fact evidences that the future dynamics of the Dow Jones values will be upward within the framework of the formation of the 3rd order fractal F113, which is the 3rd segment in relation to the 3rd order fractals F111 and F112.
The analysis of the fractal structure of the chart of the Dow Jones index together with the analysis of processes in the world economy and politics of the mid 30's allows us to estimate not only the current situation in the US economy, but also to see directions of future trends on the stock market and even their duration.
The fractal structure of the Dow Jones index time series from 1896 to 1950 on the eve of the 1944 Bretton Woods Conference.
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The dynamics of the Dow Jones index on the eve of the Bretton Woods conference in 1944.
The economic crisis that started in the USA in 1929 could last for a decade and the downtrend of the American stock market within the framework of the formation of the 3rd order fractal F112 would have been completed in 1949 approximately.
However, this did not happen due to Germany which, with the connivance of Great Britain and France, started a war in Europe.
The irresponsible policy of the victorious British and French in World War I towards Germany, which was humiliated by the results of that war, and the weakness, betrayal and cowardice of the British and French leaders in resisting the obstinate German fascism, demonstrated by the Munich deal in 1938, their refusal to conclude an antifascist alliance with the Russians and their pushing the Germans into war with the Russians, led to World War II.
A situation has developed in world politics and economics that allowed the USA to get out of the terrible economic crisis in a short period of time at the expense of other states destroyed by the war.
The analysis of the fractal structure of the chart of the index Dow Jones on the time interval (1932, 1946) shows that a fractal of the 4th order F1131, which is the 1st segment of the 3rd order fractal F113, was formed on this interval.
This fact suggests that growth of the index values has finished and the uptrend should be replaced by a downtrend within formation of the fractal of 4th order F1132, which is the 2nd segment in relation to the fractal of 4th order F1131.
In the case of normality of external actions, the fractal of the 4th order F1132 with the segments of the 5th order F11321, F11322, F11323 should form a basis fractal-attractor F22, which time and value intervals should be 61.8% of the time and value intervals of the 4th order fractal F1131.
If this is the case, then the Dow Jones values would complete their downtrend in 1954 around 110. However, no significant decline has occurred.
The lack of market competition during the war period and the gigantic demand of the war-ravaged states for all the groups of goods produced in the USA that were paid for in gold allowed the US economy to develop vigorously.
1944. World War II was still going on, but its end was in sight and the outcome clear. So in July 1944 at Bretton Woods, the USA abolishes the gold standard, declares the gold-dollar standard and makes its national currency the world money instead of gold starting the era of the US dollar domination.
1945. The USA is the most economically and militarily powerful country in the world. The economy of the USA is growing, the capitalization of the stock market is increasing, and it is impossible to imagine any reason for it to decrease in the face of the end of the 4th order fractal F1131.
However, in 1946, the values of the stock index Dow Jones decrease within the framework of formation of the 4th order fractal F1132 which is the 2nd segment in relation to the 4th order fractal F1131.
Fractal F1132 started in 1946 and finished in the same year, giving the beginning to the formation of the 4th order fractal F1133, which is the 3rd segment in relation to the 4th order fractals F1131 and F1132.
In the middle of the last century, the US stock market has excellent prospects for growth within the framework of the formation of the 4th order fractal F1133, which is the 3rd segment of the 3rd order fractal F113.
The fractal structure of the Dow Jones index time series from 1896 to 1978 on the eve of the 1976 Jamaica Conference.
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The dynamics of the Dow Jones index on the eve of the Jamaica Conference in 1976.
US companies operate and earn profits, part of which are used to pay dividends on their shares and part of which are used to increase capital, thus contributing to an increase in their market capitalisation, i.e. the growth of their share prices on the stock market.
An increase in the value of a company's shares that corresponds to the growth of its capital, taking into account the dividend yield, is equitable growth. In other cases, growth is unfair - either speculative, inflationary, or worse, both.
In the time span between 1944 and 1978, between Bretton Woods and Jamaica, US stock market growth was fair. Subsequent growth in the capitalisation of US companies became speculative and then, on top of that, inflationary.
Analysis of the fractal structure of the chart of the index Dow Jones on the time interval (1946, 1973) shows that on this time interval between Bretton Woods and Jamaica, a fractal of the 4th order F1133 was formed, which is the 3rd segment of the 3rd order fractal F113, which in its turn is the 1st segment of an even greater 2nd order fractal F11.
This fact says that the growth of Dow Jones index values in the interval from 1896 till 1973 has finished, because the 2nd order fractal F11 with the segments from the 3rd order fractals F111, F112 and F113 was finished.
Fractal of the 2nd order F11 is the 1st segment of the fractal of even greater 1st order F1. With completion of the 1st segment F11 the 2nd segment F12 begins to form, which has an opposite direction.
It is within the framework of the formation of the F12 fractal that the downward movement of the Dow Jones index will begin in 1973.
In case of normal external actions, the 2nd order fractal F12 with the 3rd order segments F121, F122, F123 should form a base fractal-attractor F22, which time and value intervals should be 61.8% of the time and value intervals of the 2nd order fractal F11.
If this is the case, then the Dow Jones values, which begin in 1973, would continue their downtrend towards 400 points in 2020. However, again no significant decline has taken place.
The 2nd order fractal F12 was formed with the time interval T12 (1973, 1978) and the value P12 = 330,40 points in the form of the fractal F23 of the ABC of attractors Niro.
A massive correction of the USA stock market, which would come to an end around 2020, was prevented by the so-called Jamaican monetary system created by the USA in 1976-1978.
In 1976, the USA again took over the world financial system for its own selfish economic (political) interests, just like in 1944.
From 1945 to 1960 the world economy has grown mainly due to the growth of the economy of the USA. The growth of the stock of goods required the USA to increase the money supply to ensure turnover and further growth of the economy.
The USA started up the printing press, declaring to the world that the US dollar was backed by gold and that at the rate of 35 US dollars per troy ounce, US dollars could be exchanged for gold at any time and in any amount.
The issuing of dollars in exchange for the US promises to convert them into gold at a fixed rate was welcomed by the world economy. The global community had no choice but to believe the empty promises of the USA.
Fractal analysis should begin with an analysis of a chart constructed with a timeframe of at least one year.
Newbies begin with a one-year timeframe...
Professionals always start their analysis with millennial timeframes...
You can tell by the choice of words that the author is downright hot for Anglo-Saxon leadership in some areas... 😄
It's already clear from here that all the pseudo-scientific chatter will be aimed at trying to discredit the US with the chanting of mantras along the lines of "soon-soon the US will collapse... just wait and see..."