FANGs and technology companies could see an additional 20~30% drop as the inflated pressures of pricing expectations deflate.
Technology, much like the 1999 DOT COM bubble, have been inflated over the past 2+ as foreign capital capital has rushed into the US market for safety and security. This recent rotation could be the beginning of a deeper price rotation in technology as capital moves to Blue Chips and manufacturing companies.
In 1999, average S&P P/E Ratio was 90. Now it is only 25. Some are in acceptable PE range such as Apple 18, FB: 24, Googl:33, but Amazon, Twitter, Netflix are much higher than 100.
UnknownUnicorn3633535
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I just clicked on the chart for the colourful wheel
@kikira, The center of the circles is based on a price theory I'm working on that I call Tesla Vibrational Theory. It has to do with the fact that I believe price swings represent energy in the markets and that energy level/frequency and amplitude varies with each new price swing (new energy pulse). My theory is that by mapping historical energy pulses, I can attempt to identify "aligning energy pulses/frequencies" as they setup into the future. It is somewhat similar to Gann theory, but applied differently.
I'm still working out the logic for this price theory. To simplify, I believe price movement is energy. And, thus, energy includes power/strength. frequency and amplitude. Therefore, my mapping these energy sources, we may be able to gain some knowledge of the future.
gingerheadtrader
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@BradMatheny, But can you explain how 'tesla vibrational theory' led you to place the center 3 years ago? You don't have to go into extreme detail here, most people don't know what most indicators do anyways, but we like to know how to use them.
BradMatheny
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@gingerheadtrader, I guess I didn't answer the original question properly. Price waves, from top to bottom or bottom to top, are price energy waves. These come in large and small price formations (the basis of Fibonacci or Elliot Wave theory). I moved the arc to the low of 2015 after measuring a price wave that RELATES to that low. You can't measure a price wave from a previous span of time and relate that energy frequency and amplitude to a different (newer or older) price wave. Each wave is unique. Each wave has a unique set of energy properties. Therefore, the way I use this technique is to identify a key price wave, in any time frame, measure it from top to bottom or bottom to top, then drag the arc to the top or bottom to see how these arcs align with price activity. If they align well with price rotation, then I know I have found a solid match and that these energy waves may present opportunities in the future. Hope this helps.