Current Wilshire Composite fractal modeling observations:
New 24 January 2022 first fractal base: 35 day vice 31 day base
First Fractal starting January 24 2022 ending 14 March 2022 :
composed of 2 sub fractals:
5/12/7 days and 3/8/5 days
Second fractal 14 Mar thru 14 July – composed of two sub fractals:
8/18/18 days and 9/19/19 days (last 19 days are up going) 86 days
Third fractal 14 July to 7/8 November composed of two sub fractals
9/21/23 days and 5/11/12/2 of 7-8 days (total 82-83 days )
Here the final third subfractal 2.5xy lower high saturation peak valuation xy/2.5xy/2.5xy falls in the last 2xy-2.5xy time frame of the third subfractal followed by nonlinear decay also (efficiently) contained in the last 2xy-2.5xy third subfractal time frame.
This morning the Hangseng Index fell below 15k. The HSI appears to be following a 23 August 2022 9/18/18/5 of 10-11 day decay fractal series :: (y/2y/2y/1.5y) which will likely take it below its 2008 nadir valuation. The Chinese equity pattern matches the end timing for the Wilshire and Bitcoin in USD decay fractal patterns. The asset-debt macroeconomic system is globally interlocking. Bad debt and overvalued assets are undergoing nonlinear liquidation.
The Asset-Debt Macroeconomic system’s 1807 US hegemonic 36/90/90/54 year :: Great Fractal Cycle
- The Efficient Market Saturation Time-based Trading to Peak and Nadir Valuation Theory of Quantitative Fractal Valuation progression:
The central banks expand and contract available system debt/money to sustain the asset-debt macroeconomic system with the bank’s defined boundary conditions of 1. unacceptable unemployment vice 2. unacceptable consumer inflation (and likely unacceptable consumer asset devaluation). The asset-debt macroeconomic system then integrates the central bank’s manipulation of credit/money expansion/contraction via interest rates and broader measures of QE/QT and self-orders and self-assembles asset valuations into the most efficient time-based mathematical trading saturation growth-to-peak valuation fractals, and trading saturation decay-to-nadir valuation fractals. Within major valuation growth trends there is periodic countertrend decay and vice-versa. These time-based saturation trading valuation fractals are seen on minutely, hourly, daily, weekly, monthly, and yearly unit scales.
2. Two simple self-ordering asset valuation time-based fractal patterns represent the most efficient pathways to trading saturation peak valuations and nadir valuations. These recurrent fractals pathways confer upon the complex macroeconomic asset-debt system the characteristics of a patterned science. The two time-based fractal patterns are:
An ‘A’ type 4-phase fractal series : xy/2-2.5xy/2-2.5xy/1.5xy (the fourth subfractal unit ranges from 1.4xy to 1.6xy)
First xy subfractal unit: time length defined by nadir to nadir point time trading saturation valuations
Second 2-2.5xy subfractal unit: time length defined by nadir to point time nadir trading saturation valuation with a nonlinear lower low drop occurring between the 2x to 2.5x time frame
Third 2-2.5xy subfractal unit: time length defined by concluding Second subfractal point time nadir valuation to final point time peak valuation trading saturation
Fourth 1.5xy subfractal unit: time length defined by point time third subunit peak valuation to point time nadir trading saturation valuation
and
a ‘B’ type 3-phase fractal series: xy/2-2.5xy/1.5-2.5xy.
The first, second, and third subfractal units of the 3-phase fractal pattern are all defined by the time length defined by nadir to nadir point time trading saturation valuations
Observational Empirical examples of ‘A’, the 4-phase series
Yearly Fractal units: Both the Wilshire and Bitcoin in USD reached a daily average high valuation on 8 November 2021. These high valuations occurred in the 90th year of a US 1807 36/90/90/54 year fractal series with valuations lows in 1842-43, 1932, and an expected low in 2074.
Monthly Fractal units: starting from the March 2009 low:5/12/10/7 months
Monthly Observational Empirical composite equity valuation examples of ‘B’, the 3-phase series: Sequentially from the ending low trading valuation of the March 2009 4-phase 5/12/10/7 month fractal series: 3/8/6 months, 8/17/16 months, and 11/26/16 months ending in March 2020.
Daily observational examples of the ‘B’ type series: from Jan 2020 to March 2020 a 6/15/15 day 3 phase decay fractal series can be observed.
3. Current valuation modelling using the above two self-ordering efficient laws of of the Asset-Debt system:
Equity Composite Asset class
Starting March 2020, a ‘B’ type 3-phase 8/16/10 of 11-16 month fractal series is observable. This fractal series is consistent with the timing of central banks’ extraordinary QE response to Covid and unemployment and later extraordinary QT response to the consumer inflation brought about by QE. The 16 month second subunit contains the 90th year peak valuation of the 8 November 2021 90 year third subfractal of the US 1807 36/90/90/54 year ‘a’ type 4-phase fractal series.
The final 11-16 month decay (8/16/10 of 11-14) starts on 24 January 2022 and is consistent with an evolving 7+/19/17 of 18 week (xy/2-2.5xy/2.5xy) ‘A’ type 3-phase fractal pattern which corresponds to a 35/86/82-83 day fractal series with a low valuation expected on 7-8 November 2022.
US Debt market: (Debt as an Asset)
The US Debt (Debt-as-Asset)Market had its sharpest 10 and 1/2 month valuation decline dv/dt(squared) since 1794
Using the debt market’s inverse parameter: The US Ten Year Notes rise in interest rates (QT) (currently 4.01 %) from 1 August 2022 is observed to be following a 14/33/20 of 26/20 days with an expected transient peak interest rate on 7-8 November 2022 with trending declining interest rates to about December 4- 8 2022. The current rise in the US Ten Year Note interest rates dates from March 2020 and is following a 7/16/11 of 13-16 rising interest rate monthly pattern likely part of a Type A 4 phase 7-/16/13-14/10 month with declining interest rates in the last ten months consistent with an economic recession.