Hi guys, someone asked me for an update. I started my count with a new chart from the beginning. I dont know if you know the concept of quantum which come from the fractals paradigm of elliot wave count. Quantum cycle is a concept where mathmatics and number are linked together and tend to repeat but with ascending numerator denominator value. This lead to infinite smaller and greater parabolics shape. Propotion and symetric is respected but the value of each intrinsec numbers tend to repeat (also known as expanding symmetry or evolving symmetry, i.e. : head and shoulder pattern, triangle pattern, etc.). While fractals can refer to one dimension, mathematics, trading refer to 2 dimensions which is the human and market thats why applying fractals may lead to divergence in time, price precision but not the projected direction.
In others words, pattern and direction can be found and backed by old values (intrinsec factors of the chart itself) but the amplitude and timeframe must be calculated with both dimension (intrinsec and extrinsec factors). So the shorter the timeframe prediction is, the more you can rely on fractals because of the lower effects of extrinsec factor may have on the projection. The understanding of the human behavior and mathematics can lead to great precision if done correctly.
"History does repeat itself but not because the market has a memory but simply because the way supply and demand interacts is decided by people in the market in a similar way, with similar criteria and with similar emotions. It may be that the details differ or the fundamental may change but unless there's a significant change, than there is no reason to expect market participants to act differently to how they do normally, thus the market will exhibit the same pattern. Because of this the market will repeat the same price action to a varying extend in time and proportions.
Probably the most known example of using fractals is when famous Hedge Fund Manage Paul Tudor Jones was trying to identify the 1987 crash in 1986 by using the 1929 market fractal (see Figure 1). You don't have to trust me on this one because there is a video documentary that was filmed one year ahead of the 1987 where PT Jones speak about this.
Jesse Livermore one of the greatest traders of all time has reached the same conclusion in his book he said something like this: “I learned early that there is nothing new in Wall Street. There can’t be because speculation is as old as the hills. Whatever happens in the stock market today has happened before and will happen again. I’ve never forgotten that.”. "
Of course this chart may be wrong but since i have make it i said to myself why not share.
P.s. : Always use fractals in conjunction with other indicators or systems. They work best as decision support tools, not as indicators on their own.
In others words, pattern and direction can be found and backed by old values (intrinsec factors of the chart itself) but the amplitude and timeframe must be calculated with both dimension (intrinsec and extrinsec factors). So the shorter the timeframe prediction is, the more you can rely on fractals because of the lower effects of extrinsec factor may have on the projection. The understanding of the human behavior and mathematics can lead to great precision if done correctly.
"History does repeat itself but not because the market has a memory but simply because the way supply and demand interacts is decided by people in the market in a similar way, with similar criteria and with similar emotions. It may be that the details differ or the fundamental may change but unless there's a significant change, than there is no reason to expect market participants to act differently to how they do normally, thus the market will exhibit the same pattern. Because of this the market will repeat the same price action to a varying extend in time and proportions.
Probably the most known example of using fractals is when famous Hedge Fund Manage Paul Tudor Jones was trying to identify the 1987 crash in 1986 by using the 1929 market fractal (see Figure 1). You don't have to trust me on this one because there is a video documentary that was filmed one year ahead of the 1987 where PT Jones speak about this.
Jesse Livermore one of the greatest traders of all time has reached the same conclusion in his book he said something like this: “I learned early that there is nothing new in Wall Street. There can’t be because speculation is as old as the hills. Whatever happens in the stock market today has happened before and will happen again. I’ve never forgotten that.”. "
Of course this chart may be wrong but since i have make it i said to myself why not share.
P.s. : Always use fractals in conjunction with other indicators or systems. They work best as decision support tools, not as indicators on their own.