Articles

Time machine

30th October 2019 original post at
https://tradersworld.com/issue75.pdf

Would you like to know the trend of each trading day in advance?
DeLorean indicator shows if the next day is positive, negative or unclear. Really fascinating to calculate the energy for tomorrow using our physics model. We have been doing this since March 2017 with an uncanny result and only a handful of losing months. (see overview)
Nothing is random, everything is connected and all is fractal, price patterns as well as time patterns. Surprisingly time patterns could be calculated exactly while price patterns- such as Elliott Wave- are no exact science before the fact. Time patterns/cycles is not a sort of statistical approach like projecting the price moves of the past into the future, calibrating it and fitting all sorts of static cycles. This approach will not work unless by coincedence. The future will be different from the past.
The first application of our invention was the most difficult one, to forecast the open of the indices for the days or month to come. This has to be very precise, since we take position the evening before and close at a predetermined time the next day. When the model predicts an uptrend (positive energy) at the opening, we enter the market at the close the day before taking a long position in futures or options. On prediction of a downtrend we enter a short position. Next day at the opening we close the position at a predetermined time, so there is no leeway that a wrong prediction could still somehow become profitable by sitting it out.
Later on we started using initial stops and trailing stops to optimize results, when the (positive or negative) energy became stronger during the day.
Let’s put this into practice and give you the predictions for SPX, which we sent to our customers by mail on 30th of September for all the month of October 2019.

Attached to this mail our users find predictions for every trading day. No prediction in the sheet means neutral or unclear.
The attachment can be seen on the next page where we now have filled out the results of the prediction, a whopping 148 points profit using one future ES.
The SPX traders are very content with good results of SPX DeLorean, particularly the last month. Now we are using a trailing stop of 8 when price change has already been explosive, otherwise of 10. Additionally there is an intial stop of 10 points.

Firstly we will explain the sheet. Most important is (look at the header of each column) the trend date and TREND, which is the date we are predicting and what to trade for. So the 1st of October the forecasted TREND was UP. Therefore we enter the day before at the close 21:59, see entry date. Consequently we BUY (ENTRY TRADE) the ES future (SPX) on 30th of September and SELL on the 1st of October at 15:00 to cash in or take a loss. When trend continues in forecasted direction we use a trailing stop, which can add considerable extra gain, but also results will be a bit different for each trader.
Clearly if the trend date of 28th of October is UP, traders will have to enter their trade on Friday the 25th at the close and take position overweekend. The 28th our model showed a very strong positive energy, which in fact should mean that during the weekend and on the 28th there will be most likely positive news that will make prices rise.
One more explanation on CANCEL you will notice. This is the only signal that has been changed the day before the trend day and communicated with our traders. Also the time in yellow is a deviation from the default times, so entry or exit times are more specific.
All in all the above approach has resulted in the following track record.

Please contact us if you have questions.

Back to the future
Brexit and election UK December 12th 2019
Finally we have a date for the expected election in the UK to break the deadlock in parliament. December 12th it will be decided how the political landscape will change.
Before the election at the 6th of December on friday markets are expected to decline when reversing from a positive indicator to a strong negative reading. The day after the election, the 13th looks like positive for the markets but most probably this will turn negative. There is a pattern that in its specific form at that time has a history of negative markets in spite of the fact that the indicator is positive the 13th. We have researched our long term database to see what statistically happened. If it is very negative, then the election outcome could even make a no deal brexit possible again, which would shake the markets, in spite of the fact that it could be beneficial to the UK in the long term, but not for Europe.

Presidential election USA on November 3rd 2020
Traveling to the future our model calculated the following picture.

Clearly this is a very negative outcome especially after the election. Unlikely that a victory of Trump will be regarded as positive news, so the deep red indicator shows his re-election in a very hectic sort of crisis situation.

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Time will tell

By Rick Versteeg

Would you like to know bull or bear markets before they happen?.
Look at the examples below how DeLorean indicator tells if it is positive or negative in this exact time or period. How fascinating is it that we can travel in time and calculate the indicator for events way back  in the past, like the French or American revolution, to see what it  would have forecasted. The same as we do for future events…

History will repeat itself. History is time. There is a hidden order in all events that we witness, small or big. Everything is connected triggering the next events. Nowadays this has been accepted as the mainstream view.  Einstein said “God does not play dice with the universe”. Nothing is random.

So History is the key to understanding the world and how the clock ticks. When long ago the flash idea occurred how, what and why our time cycle clock might be able to tick correctly, we still needed proof. We expected, of course, that it would work fine, but in general.
Indeed it works, to our surprise even much better than we could imagine with an uncanny detail.
Thanks to available history we were able to test extensively the working of our time cycles, fractal time patterns that are connected. While testing a lot more specific information and combinations it became clear that our energy model and the dynamic rhythm could be calculated more precise by connecting it to important historic events. If the time cycles and its patterns do forecast the future, they should connect to important events in the past. So this has been the first step, while checking the short term forecast of market prices at the same time in real time. Another approach is to use past events as an inception point for the future, this could for example be the origin of a country like declaration of independence of the USA 1776. Alternatively one can use big price movements, like bull markets and bear markets (beginning or end) as inception point of a cycle. This as the next research project, which is a continuing story.

South Sea company In Great Britain, a considerable number of people were ruined by the share collapse, and the national economy greatly reduced as a result. The founders of the scheme engaged in insider trading, using their advance knowledge of when national debt was to be consolidated to make large profits from purchasing debt in advance. Huge bribes were given to politicians to support the Acts of Parliament necessary for the scheme.[4] Company money was used to deal in its own shares, and selected individuals purchasing shares were given loans backed by those same shares to spend on purchasing more shares. The expectation of profits from trade with South America was used to encourage the public to purchase shares, but the bubble prices reached far beyond the profits of the slave trade

The point is that in energy, how it travels and by what extent it increases or decreases, everything is connected. Our premise was that this energy will influence the subconscious of humans to take action, change direction or influence any other decision. Humans believe making a choice to control their world independently and rationally, but in our opinion it is just a reaction to the energy they are exposed to. Negative energy will make them worry and panicking, positive energy leads to wishful thinking. Consequently the masses will become negative or positive and thereby create bear or bull markets. Still, not all individuals are influenced to the same extent nor will follow the herd all the way. Since the majority (80%) is the herd, financial markets will follow the accumulated decisions of individuals of the herd which will cause the market indices to rise or decline. We focus on indices because participation of investors in individual stocks will not as well reflect the view of the masses.

To inspect behavior of the masses we need to analyze International events and bubbles, that have a more or less world wide impact. One should bear in mind that our time cycles are in line not only with market behavior but also with economic and social developments in society. The shorter term time cycles in the Delorean indicator though are most reflected in short term market fluctuations.


Bubbles

South sea bubble

A very well documented bubble is the South Sea Bubble, which took place in the Great Britain at the same time as the Mississippi Bubble in the USA and more or less the same speculation in France. Within a very short period of 1 year the South Sea company shares had a meteoric rise from 100 to almost 1000, to decline again to where it began and ending in bankruptcy.

In Great Britain, a considerable number of people were ruined by the share collapse, and
the national economy greatly reduced as a result. The founders of the scheme engaged in
insider trading using their advance knowledge of when national debt was to be
consolidated to make large profits from purchasing debt in advance. Huge bribes were
given to politicians necessary for the scheme Company money was used to deal in its own
shares, and selected individuals purchasing shares were given loans backed by those same
shares to spend on purchasing more shares. The expectation of profits from trade with
South America was used to encourage the public to purchase shares, but the bubble prices
reached far beyond the profits of the slave trade
(Source wikipedia)

Until end of July the long term cycles and time patterns showed strength, mainly green and above zero. However from then on the DeLorean indicator strongly declined and stayed below zero for a longer period, indicating the end of the bull market run or bubble in this case. Additionally there was a exceptional clustering of time cycles as we often see when markets are likely to crash.

As explained in other articles, the DeLorean indicator is known for the nearby future. Consequently if you see in the future a significant decline of the indicator, remains below zero for a longer period, then it is time to sell. So the savvy investor in 1720 with the indicator at hand would have recognized the danger for the next month and sold his stock in time.

Bear market 1929 and depression

This well known bear market took exceptionally long time to end. In the picture below you can see why : during a period of more then 5 years the DeLorean indicator of long term cycles showed a below zero reading and was very weak.

As usual the beginning of the crash was triggered by an extreme cluster of shorter term cycles and time patterns that triggered the decline.

The future of DeLorean indicator

The following chart displays the indicator for the future. I will give you the long term which shows that the 2nd half of 2020 is negative, see lower indicator “…PLA”. The indicator is far below zero and apart from smaller recoveries it stays there till beginning 2021. You would like to know what happens before? Mail us .

The indicator right below the chart shows the shorter term fluctuations, trends for days or sometimes weeks. I give you end 2019 and the beginning of 2020, which is UP, as always with retracements of course. The more both indicators confirm each other the higher the probability but on its own its already strong. However the more you know the better your probabilities. So just get in touch for more information and see our website to order. Thanks for your interest.



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Clock work timing

This article will show also our long term Time patterns model, suited for longer term investors. A very interesting pattern is at work.
Furthermore we will evaluate our shorter term models and indicators, show results of our option time model on real historic CBOE option data and introduce a newly found acceleration pattern for traders.
DeLorean Opening prediction
Again an excellent result on all markets. DAX January + 151, February + 109 and March +182 points. SPX January + 63, February + 33, March + 26 points. The recovery and high volatility in January explains the extra points gained.
Back to the future- based on DeLorean indicator monthly
Predictions in last article (Time’s up) made the following predictions. Take a seat in DeLorean and we will travel to the future and back. Every day and week there will be trends up and down, small and large. Look at indicator going up or down at the predicted date.

Long term Time patterns-Another correction coming
Actually this analysis is a must for longer term investors to have some idea of what the future will bring. Back in 2014 we have already wrote an article about some of characteristics. Meanwhile we have developed a pattern recognition that finds matching patterns in the past and future.  Next step is to compare trends and performance for this pattern as found in the past. Right now a very specific long term pattern has been forecasted from our time cycles, see the top indicator represented as a green line. Using this approach we can look into the future when a time pattern will be there and how it looks. Since history repeats itself, patterns do as well and thereby give a good approximation of what markets will do in the future if the time pattern has the same effect on markets.
The pattern displayed here from half of 2018 till beginning of 2020 highly resembles the pattern at work in from 2001 till 2003, which is why it got our attention. Back then it was part of a bear market, including the 9/11 terrorist event, resulting in a decline overall of around 30%.

The performance of the best matching patterns are displayed in the chart below. When performance is alike markets could witness another strong correction in 2019. Since this is a long term pattern, it needs a larger time band width of around 3 months.
Typically during the 1st green wave up, also in 2001-3, the correction starts with a sharp decline, when the indicator at the bottom of the chart (black line) below starts to decline from its maximum above 2. The red line indicator is a volatility indicator, above 1 and rising means high volatility.
When the green indicator is in the middle of its high above 1, historic performance shows that normally a decline will happen, therefore pointing to the period June- September. History also shows that if the indicator on the bottom has a reading above 2, making several tops, that the occurrence of a larger bear market is more likely, pointing to a level in the Dow of around 21000-22000 points.

Historic performance with same pattern displayed in chart above. Time pattern circled in RED, that coincides with corrections. Green line is Pattern and direction, red line is volatility when rising and nearing 1, black line is strong correction when above 2. The colored lines in the chart itself are historic perfomances when sam pattern active.


UPDATE Trading system using options.
A mentioned in our previous article , we have developed a directional tradings system for options using DeLorean Monthly. This means that we follow the direction of the indicator to trade long or short using options. Additionally mention that we use SPX options because of liquidity, diversification, pricing and expiration every 2 days. Short term options are most advantageous.
Now we have extended our research and simulated the results of our trading strategy using DeLorean indicator with historic real time 15 minute option prices of CBOE. Our software automatically selects out of the money options for writing calls or puts at a 0.5% (this can be changed to any %) out of the money excercise price compared to spx at the moment of trading. Stop level is at 0.9%, reducing this to 0.6% still gives around 80% hitratio.
Consequently there is always a leaway of 1 % for the position in case the market does not follow the DeLorean indicator immediately.

Trading is based upon the swings in the indicator from top to bottom and vice versa. So a short trade (red arrow)-writing calls- will appear when the indicator starts to decline. A long trade (green arrow)-writing puts- when indicator rises again from a bottom. The strike price is 1% above the SPX price when writing calls and 1% below the market price when writing puts. This way a trade will still have full profit as long as it stays within this bandwidth. If not the trade is stopped out.
With a capital of 150k 3 years trading options resulted in a profit of 144k, almost 100% with a max drawdown of ca. 5,5%.

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Time’s Up

Last quarter of 2018 crisis was predicted in advance using the DeLorean indicator. A larger correction was overdue for a long time and time was running out. So inevitably at some point there would be a breaking point where our indicators turn RED. Finally we have witnessed again extreme turbulence in the stock markets which has upset the financial world. Investors and traders were not accustomed anymore to wild markets, not counting the February 2018 flash crash, nor a bear market.  A decline in the SPX index (as well as many other indices) of 20% was indicated by the time patterns and triggers of DeLorean, before it happened.

Continue reading “Time’s Up”

Once Upon a Time

History repeats itself time and time again makes it possible to discover hidden order in the apparent chaos in financial markets. So what happened once upon a time will happen again when intertwined time cycles indicate the same energy to cause panics or bull markets. People respond to energy whatever the source is.

History repeats itself

The research we have complete in the last decennium was only possible because nowadays we have available a vast amount of price data as well as the fact that computers are fast enough to process this data using complex algorithms. In addition, programming software has evolved to such a good quality that programming complex models and its maintenance is possible today. Also science and mathematics have made big steps in understanding and modeling complex interrelationships using big data.

Continue reading “Once Upon a Time”

In the Nick of Time

One year ago, on March 19th of 2017, the story of DeLorean had a beginning, after many years of research. Using time waves predictions had been made for the first time to forecast the opening of future trading days- for ALL trading days at once- from March 20th until the beginning of May with regard to DAX and SPX.

The trend for a trading day Could be UP, DOWN or neutral (=not available). Obviously to take advantage of this prediction traders had to buy or sell the day before. This has been documented and sent to a selective group of traders.

Beginning of April 2017 we contacted Tradersworld to sent research along with predictions and wrote the first article for Tradersworld.

Beginning of May it seemed that the outcome was very significant with a hit ratio of around 75-80%, healthy profits and no drawdown on a monthly basis. Still, it could have been a only good period. Now, after one year of predictions, it is clear that our time waves and cycles, which are fractal in nature do work quite well. Below the results for DeLorean predicting the opening trend of the next day one month ahead:

Continue reading “In the Nick of Time”

Just in Time Trading

Referring to our last article in TW #66, we will show more of our time cycles systems and focus on the SPX expecially. (All predictions have been sent to Tradersworld in advance and support our results.) Also we will review August 2017 and point out some periods to come in September, which will now a lot of volatility. Please take join the ride and just try it, you will be surprised (see special offer for Tradersworld)

We are of the opinion that TIME is the most important variable in trading, especially if combined with trend forecasts. For this purpose fractal Time cycles have been discovered after years of research.

If a trader has a high percentage chance to forecast when a trend will begin, his hit ratio and win/loss ratio will already rise dramatically.

Should this trader also have a reliable prediction of the trend, therefore knowing when and in what direction it will happen, then the odds are even more in his favor.

That is exactly what DeLorean (time waves and patterns on a small scale) predictions do, forecasting when a trend will start and in what direction. DeLorean does this with on average an uncanny precision, although there are and will be shorter periods that forecasts are less precise.

The only way to be able to profit from DeLorean predictions or any Time cycle is by applying the method consistently and use a fully quantitative approach. This is where our Time Patterns and waves are different from Elliott Wave, because the latter is – although quantified and systematic- in the end an interpretation of teh count. Even worse, if the correct pattern has been found, a trader does not know what the next wave will be or when it will start. Using DeLorean this is much more clear and effective.

Continue reading “Just in Time Trading”
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