Tuesday, December 27, 2011

S Curves

When ever we have competition ( or the opposite ) for a limited resource . We have Floors and Ceilings. We have S curves.

Competition  for a  Limited Resource. Unfolds as a Cycle . It is a process with beginnings and ends. It has a  Life Cycle. 







Some observations

A process that unfolds with no self awareness

is a pure S curve. 










A system with awareness.. So The participants are getting cues from each other..

IS a S curve ... With precursor-catching up and delayed ending overshoot features. This could easily be a EW 5 wave cycle ( or it might not ) .. The smooth S is pushed out of shape by positive and negative feed backs which create overbought and oversold of different types ( esp different at the toddler and the geriatric stages of the cycle..Both have unsteady steps but different )


Looking a bit like a Stock Chart  ? Here we have Waves that Gather Followings !







The S curve is the accumulation markup distribution --to a -->bifurcation point, a fork in the road that leads to either re accumulation or markdown...


Note Especially the deep pullback ( weakness ) in the early trend and the false strength ( The over shoot ) in the ending trend.

There are also cycles in cycles













A growth cycle without awareness ( bacteria in a petri dish ) is a pure S curve.
A growth cycle with awareness ( a liquid market without  manipulation ) some sort of Elliot Wave pattern ( possibly)..

However liquid markets beyond manipulation do not exist except on time scales that are of generations..( eventually it is true everything does come to the end of times and then can be seen for what it really was).

The next stage up is a real  market with smarter money causing manipulation ( along with everybody else ) ( manipulation is the OPPOSITE of RANDOM ).

In a manipulated market... Methodologies only work if it is in someones interest that they do  work...And they stop working when it is in someones interest that they do stop working..

So on practical time scales

What matters is what the smarter money is doing
and practically nothing else.....


Everything is a tool for manipulation either for accumulation, markup, distribution or markdown..

A tool is most useful if the opportunity cost of using it is minimal..

Following the Smarter Money has zero opportunity cost...

With correct principles It then is only a matter of skillful application..




A manipulated Market is characterized especially by TRADING RANGES ...BY Support and Resistance.


Support and Resistance will DAMP or EXPAND the "normal excursions" seen on the Precursor/ overshoot Curve. It will tend to keep you out and lock you in JUST AT THE WRONG TIMES.


So --> Competiton and Limited Resource.  QUESTION--> Who or what competes - For who or what  on the markets and HOW  ? 


The most useful Definition of Smarter Money is this --> They tend to Buy and prices go up after they have finished and they tend to sell and prices go down again after they have finished. 
The after they have finished is IMPORTANT.

Also it follows from the definition that we do not have to know who they are or even if they are real people . We just have to measure==> Price , Volume , Time in the Context of POSITION and SCALE.  ( The COMPOSITE OPERATOR )



S Curves :-) or  --. Why Theodore Modis is in the reading list.



Motorway

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