A 2 year scenario projecting the financial crisis of 2008-2009 into the future
Chart (W, LOG):
Methodology:
Main Implications:
Notes:
1. IEI : I eyeballed it
2. Gann would not be happy and the result could be different on a RENKO or equivalent treatment of time (a great follow up idea)
3. The night the Yen was devalued I held positions in gold in bond futures ( GC and ZB). I have used stops without exceptions from that day on.
best graphics:
Chart (W, LOG):
- Stocks: The averaged futures for SPX , NAS and DJ were weighted so that a 1 point change will imply the same change in $ terms. (For weights see https://www.barchart.com/futures/contrac...
- 200MA, 50MA, and 21MA
- Today's price and date: at the intersection of the cross.
- Financial crisis: Purple box on the left
- Implied scenario: Purple box on the right. Left edge starts 10/5/2022 ("Today" .. for the next 10 min)
Methodology:
- The scenario is a scaled up copy of the box at 2008-2009. It is stretched to fit the current price, and it's 3 MA's.
- For simplicity the price / time aspect ratio was preserved.
- Criteria for 'best fit' (using IEI ) were the absolute level and curvature of the 3 MA's. In other words, the distance between the MA's, their slopes, and the speed each slope was changing.
Main Implications:
- The scenario implies a crash (ripped from Feb 2009) beyond the March, 2020 COVID low, as far as the highs of 2015. This is after the end of QE , when Greece went into default and the Yen was devalued overnight .
- "Bottom" of the implied crash is one year from today (10/5/2022).
Notes:
1. IEI : I eyeballed it
2. Gann would not be happy and the result could be different on a RENKO or equivalent treatment of time (a great follow up idea)
3. The night the Yen was devalued I held positions in gold in bond futures ( GC and ZB). I have used stops without exceptions from that day on.
best graphics: