Mike
08-03-2013, 05:36 PM
In mid May I posted analysis based on Didier Sornette's observation that markets undergoing super exponential growth cannot continue for long and that an approximate time to a regime change can be estimated in advance. That analysis predicted May 22 for a change. The market began a correction on that date. Didier suggests that the prediction date can be estimated months in advance within a couple of weeks. May 22 began a short pull back but none the less the super exponential growth was stopped for a while. Today it appears that the market has doubled down on more obvious super exponential growth. On a log-price-scale chart a straight upward sloping line indicates exponential growth. Super-exponential growth will show upward curvature. Here is the NASDAQ on a log-scale weekly chart:
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It appears to my eye that there is indeed an upward reaching curvature.
The next chart shows a fitted Log-Periodic Power Law equation to the NASDAQ daily close values.
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The date that comes from the fitting is 2.3 trading days away. I note that Pascal has suggested caution based on his observations, I guess this analysis suggesting the same thing. If you Google Didier Sornette's name you can read more about his methods.
19411
It appears to my eye that there is indeed an upward reaching curvature.
The next chart shows a fitted Log-Periodic Power Law equation to the NASDAQ daily close values.
19410
The date that comes from the fitting is 2.3 trading days away. I note that Pascal has suggested caution based on his observations, I guess this analysis suggesting the same thing. If you Google Didier Sornette's name you can read more about his methods.