Energy Flow v7

[ForJL]

It has been some time now since I have posted an Energy Flow Prediction and decided to do one today. I really don’t have a lot of time to go into specifics about this post other than to say that it represents considerable effort on my part to redefine the “Bookend” period that defines the energy signature used to generate the forecast. The end game for those of you not familiar with my work is to combine all areas of astro analysis into one complete theory. In other words to have market geometrics, market cycles, energy harmonics (time and price), and energy generated price predictions all working together as one concise approach to trading any and all markets.
There are two YM charts below. The first is a “raw” prediction without any adjustments made according to Energy Flow hypothesis. The second chart represents said adjustments. Those of you who are familiar with this work will understand what I’m talking about here. For those who are not just post a question and I’ll try and answer it when time permits. In the second chart the vertical lines represent EFCIT signals. I believe the CIT signals still need some tightening but I have been using them with success.
Okay, the usual disclaimer … predictions are cool, especially when they work, but always take them with a grain of salt. Always rely on your own work and what works for you. Having said that I can also say that I have been using this version of Energy Flow since late February on an intra-day basis and it has worked extremely well. I have been using this particular forecast now since mid-April and it too has performed exceptionally well. Especially when used with the intra-day forecast. However it’s the first time I have looked out this far with this version of EF and we are nearing the end of the forecast period (@ 05/21 and 06/03).
Best,
Joe

[ForJL]

I just wanted to show you guys a quick example of what I meant by using a longer term price prediction with a shorter one. As it turned out Tuesday was the only day I worked this week but it will serve as a good enough example of what I’m talking about.
In the chart below the fuzzy peach lines represent the prediction in the chart of the previous post. As you can see it clearly shows the bias on Tuesday would be up. This is helpful in a couple of ways. First, we want to trade with the bias so in this case we want to look to be long. It doesn’t mean that we can’t trade the shorts but that we need to be nimble when we do. Second, it helps us recognize the potential, or lack thereof, for inversions within the shorter term prediction. We of course can “zoom” in or out in our predictions by identifying either shorter or longer energy signatures. That being the case I put the question to you … what does it suggest?
While I know you don’t have EF you can take the same approach using W59’s Natal Forecast. Build different models to cover different periods. Be aware that they should have a relationship with one another and that the signatures themselves will dissipate over time as new ones take hold.

Joe

[ForJL]

Okay, so how are we doing so far? If you are familiar with my work from the old board I’d say you are doing pretty well following this prediction. If not then my guess is your lost in its interpretation and already given up on it. So let’s try doing a quick overview of what has happened so far and then I’ll see if I can point you guys in the right direction for building you own models.

We start Monday’s trading with a strong CIT energy cluster signal. The market had come off of strong selling on Friday so I was looking to go long early. I was at my desk by 05:15 Monday and at that time there still hadn’t been a reaction to the energy signals. Given the timeframe of this prediction that wasn’t unusual as I use these predictions as general guidelines and not strict time/price objectives. I had my intraday EF workup finished and it was in agreement with the main forecast (second chart). Six o’clock comes and goes and still nothing (end of first energy wave) in the market. By 09:00 it was clear if anything happened it would happen on the open. However by that time the first energy had passed and it had to be marked as a base harmonic wave (colored in light blue labeled #1 it is essentially half of the predicted wave but is the base from which all expansions can occur). Cyclic work was strongly positive as was the intraday EF forecast so I was still looking to go long. If correct it meant the next energy wave (#2) had to invert. Therefore two predictive lines are drawn … a base prediction (the green line labeled #2 which was the correct one) and a simple inverted energy wave (the red dashed line). Note that duration and start end points remain the same. Sure enough the market starts to rally off the open and I get a so-so fill around 09:35 for a good trade. Now had the market traded up and through the inverted target of the red dashed line I would simply add another base harmonic to it for my next target area (the blue dashed line). Thought of another way the dashed blue target represents base harmonic x 3. Now I unfortunately didn’t trade today but it was pretty clear the forecast would again invert if for no other reason that inverted waves tend to run consecutively. (There are other reasons but I can’t really go into them. )We can however guard against chop by using the inversion window. Essentially it is a statistical study I did quite some time ago that stated if inversions were to occur they would most likely occur between 17% -27% of the energy wave length. This is just a statistical bias and by no means infallible. The fuchsia targets of the current energy wave (labeled #3) represent inverted base x3 and base x 4 targets. As I said the other day these sorts of predictions are nice when they work but can blow up anytime so always use with caution.

So what if you decide you want to build your own model but you are not sure where to start. For me it begins by defining what comprises the energy signature. I do not want to look at everything simply because everything is not relevant and I want to key in on what is. Therefore I need a start point and an end point. Suppose for example your research has shown that the market really moves on every full moon. What you would do is look at all significant astro related events between the last full moon and the next for they are the components of your energy signature. Obviously the possibilities here are limitless as to how you define an energy signature. If you have done research in this area before you will be one step ahead of the game because you should already have a good idea of what moves a market and what doesn’t. Once you have defined your energy signature you can then proceed to build a workable model. A couple of quick points before I rap this up for today … 1) Remember that we live in a dynamic and fluid universe and things change. What’s relevant this time around may not be the next. 2)Astro related events don’t begin and end with aspects. There are many other things you can look at. 3) Rome wasn’t built in a day and I doubt your model will be either. It will most likely take time and refinement.


As always hope some of you find it interesting.

All the best,
Joe

[ForJL]

Yesterday was a strange day as far as the prediction goes but its part of trading and something we must deal with. We start off with an X energy CIT signal which is basically nothing more than a weak signal that has little effect. In yesterday’s case this signal quite frankly looks more like an error because we are already in a low energy environment and we get no reaction at all. Moving on to the Price Predictor we start off golden as the market takes off just where we expect. However the release of Fed minutes sends the market spiraling back down and EF doesn’t see this. The saving grace, if any, was that the Inversion Window picked it up perfectly falling right in the middle of the 17% -27% length of the energy wave. It was a similar situation in the intra EF shown in second chart. There were a lot of other technical reasons for the top with two being old school … a 64% retracement of previous swing and 100% breakout move off of Triangle pattern which both targeted the top (third chart). So for these reasons and others I was looking for a reaction but didn’t expect the total collapse that we got. Coming into this morning’s trading we see the CIT worked perfectly for a 100 points as I write this.

Joe

[ForJL]

I’m traveling tonight so unfortunately won’t be able to see how this prediction ends. Consequently this will be my last review while it is still in effect. Let’s start by taking a look at the CIT signal from last night. When I wrote this morning it had produced about 100 pts in the YM. It went on to produce approximately a 100 more pts before the energy wave finally ended. These signals are designed to catch major tops and bottoms or secondary ones. If one were to think in Elliot Wave terms the secondary’s would be a top or bottom of one “degree” less.

Moving on to the Price Predictor you will notice from my post this morning I went with a normal base prediction (light blue line labeled #1) and as you can see even with all the gyrations that turned out to be spot on almost nailing the bottom perfectly. Moving on we were a bit early on the turn but still solid. I am again going with a base prediction here (light blue line labeled #2) because of time price/range studies and common sense (not likely to get a 100 pts move between 17:00 and 22:00) dictates so. However if the market were to move past the base prediction I would immediately make base x 2 (blue line labeled #3) my next price target. Going into tomorrow those two CIT’s are close enough so as they could be a cluster and produce one signal or far enough apart as to act individually. Generally speaking I like to see them closer when considering them as clusters and is one of the reasons I say that they (the algo) needs some tightening.

Joe

[ForJL]

I got back yesterday and have a little time on my hands so let’s take a final review of the predictive period. As you can see from the chart below the base normal prediction (here labeled energy wave #1) was about as accurate as you can get. Make no mistake, as far as these type of predictions go that kind of pin-point accuracy is not the norm. However if you look closely at the end of all the energy waves we are fairly close to where price concluded at that specific time on all of them. Even the very first energy wave of the predictive period, which was probably the worst of the prediction, was off quite a bit on time but was right at the closing price of the breakout. Moving on to the final energy wave (labeled #2 on chart) it was obvious fairly early on that we had gotten another inversion. Those of you who have followed my posts from the old board will recall that I said many times that inversions are fairly easily dealt with. Forecast shift on the other hand is a whole other story but that’s for another day. The method that I use for spotting inversions is actually simple and strait forward. The first step is to identify the inversion window which as I already stated is 0-27 percent of the length of the energy wave measured in time with most inversions occurring between 17-27 percent. The second step is to take 10 percent of the normal predicted wave (base x 2) measured in price and then take the result and draw boxes off of the opening price of the new energy wave. The second chart below is an example of what I mean. [Note: The intraday EF predictions used in these posts are meant as teaching examples only as they were posted after the fact. I would never suggest to this body that you just take my word on their accuracy as predictions.] The final energy wave measured 248 pts in price and 1095 minutes in time. So after you do the math you get a box that measures 25 pts, both up and down off the open price, and 300 minutes in time. You then watch price action for bias. Ideally you want to see a breakout out of the box that doesn’t return back to the inversion window. Failing an outright breakout we look to see where price did most of its trading relative to the box. That was the case on Friday where we see price trading in the upper portion of the box throughout. Thus it became pretty clear that we did indeed have an energy wave inversion. The key here is the length of the box in time. What happens after the inversion window ends is of no significance in directional bias. So if for example we get a dramatic swing back through the box price at say 50 percent in time of the energy wave all we have is a plain old mistake! And trust me, no matter what kind of model you develop you are going to get them. I’ll come back to model development in a minute. A look at the two final CIT signals show that they did quite well with the first being two bars off the low and the final one being one bar off the top. All in all I was extremely satisfied with this prediction. While there was one particular trying moment at 14:00 on the 18th Gerbino Energy Flow mechanics held up brilliantly, in my opinion of course, and could not be happier with its performance.

Now that the predictive period is out of the way let’s take a look at the bigger picture of things. As I said at the beginning of this post, predictions are cool and all that but do we really pay that much attention to these kinds of things? I suppose it depends on who’s doing the post but at the end of the day we want to be able to do these things ourselves for it is with ourselves that we have the most confidence. Or at least we should otherwise we are in the wrong business. So can models such as these be built in Wave59? While no expert on Qscript from what I have seen of what Earik has in there I would definitely say yes. However if you want to do something along the lines of Energy Flow you will probably have to allow for some manual inputs as some of what you will need is not in there. Specifically, I am talking about Solar generated energy measurements which is what makes Energy Flow different then what is more readily available out there. If you ever wondered what is the difference between GEF and GEMGP it is that GEF looks at Solar and astro while GEMGP looks at Geo Magnetic fields and astro. The next obvious question I suppose would be can this be done using the Natal Forecast in Wave59? While the NF is quite robust and I have seen some dynamite forecasts using it, Durks come to mind right away, you cannot do this type of modeling from there. I have tried a few times to build a model within the NF that would just adhere to the principles of the inversion window but came up short. I’m not saying that it can’t be done but just that at this point I haven’t been able to.

So until I do another forecast I’ll call it a wrap with that. If anyone has any questions I’ll be more than glad to try and answer them for you. In fact I would enjoy the conversation.

As usual I hope some of you found it interesting.
All the best,

Joe

[Feinberg]

Here is how it worked out............... PDG (Pretty Darn Good).

What was known was the price behavior through Friday, May 13th.

What was not known is what I have drawn in Blue (first chart).

Now compare what was drawn in advance with how it worked out.

I thought it was exceptional.

Joseph

[dirk]

Hi Joe , as usual your work is fantastic.

Dirk

[ForJL]

Hi Guys,


Your comments are much appreciated ... thanks. Dirk, also my apologies for misspelling your name. It had been a long day.

Joe

[Simon.B]

Hi Joe,

Joseph's post puts it all in perspective - great work !!!