Update on Flash crashes, mini crashes, financial panics…and synchronicity

On August 18th, I had a post on flash crashes and financial panics, in which I observed that the May 6, 2010 “flash crash” occurred almost exactly one year from the current market high off the March 2009 low, which was on May 2, 2011. These two May dates were then plugged into the Code Calculator to obtain the following projected dates:

1.382 9/16/2011
1.5 10/29/2011
1.618 12/11/11 and
1.667 12/28/2011

It was then proposed that one would watch out for a significant change in trend within 2 or 3 days of these dates.

The first date of 9/16/2011 has just passed. It falls within two trading days of the market high on September 20th. The market has sold off violently since then. So I would consider the first projected date as satisfying the Code sequence. In fact, on the $SPX, the 16th was really the first of a double top, which was only inched out by a few tics on the 20th, which often occurs as traders “run the stops” (I was very lucky that my SPY puts were not taken out on the 20th–a fortunate case of being both lucky and right!). So from that point of view, the Code sequence was exact.

Is this a case of “perfect order in the markets” (which Scaby complains is a “puffed up” and presumptuous phrase, but he is just a bug and can’t trade the markets without my help)? Well, it might be. The following chart shows a map of the sequence, starting from May 6, 2010. (Click on the chart to enlarge.)

Two things (beyond the sequence itself) suggest “perfect order”. First, the orange horizontal lines show a simplified price grid from the low on May 6, 2010 to the high on May 2, 2011. Do you see where the September 16 turn occurred? Right at the 50% mark. If you were looking for confirmation that this time Mark was active, that’s pretty strong. Secondly, do you see the lighter dotted line perimeter of a circle running through the same point? That circular expression is based on the only other calculation that I use, other than the fibonacci ratio, in finding circular manifestations in the markets. It is based on the ancient geometers’ notion of “squaring of the circle”, but has not been re-discovered or exploited by the quant-oriented computer programs of Wall Street (largely because they don’t bother to square price and time, without which no true geometry could be found). In any case, seeing the high of the 16th/20th occur right on this perimeter was a second sign that the Code sequence was in play.

Given the likely fulfillment of the sequence on the first projected date, I would not expect further changes in trend, or flash crashes to occur on the subsequent dates, although I would still keep a careful eye on in particular 12/11/11 as that is on the same fibonacci ratio numeric line of the first hit.

The trading and investing information in this website is for educational purposes only and in no way should be construed as investing or trading advice.

+JAG

This entry was posted in Current Events, Perfect Order in the Markets, Predicting the Future. Bookmark the permalink.

2 Responses to Update on Flash crashes, mini crashes, financial panics…and synchronicity

  1. Trish says:

    Intriguing! I put up a review of your book today. Got some great comments!

    Best,
    Trish

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