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James Sogi

3/21/05
A Dog! Panic in a Pagoda

S&P prices this past month have been like:

1. a Palindrome, a phrase the same forward as backwards, the nickname of Soros, the investor whose name is one.
2. Retrograde motion, the term used in music to signify the introduction of a musical part which is composed with the same notes as a different part, but in a backwards order, mirror writing. Bach liked this technique. (Here's one for Tim Melvin. Why are music, drinking and speculation all similar? They all involve a wavering modulation from bar to bar.)

Palindrome examples:

Able was I ere I saw Elba.
Mix a maxim.
Solo gigolos.
Step on no pets.
"Mad at Adam?"
Ed aced a decade!

Stock Examples:

Its all similar. Prices that follow a pattern up then reverse the pattern down, like prices this past month, up 40, down 40 to point of beginning. What happens after such a structure? Magee called such a structure a head and shoulders pattern. Chair criticized the pattern as mumbo. Here is what this experiment shows.

If we define structure as a rise of over 35 pts from day -18 through close day -9 and a decline of over 35 pts from day -8 through today.

This researcher found 11 such structures in SP big since 94. 10 days after we see a mean decline of 24 points with std of 25 pts and a significant t-score on the distribution and a 91% win rate on the short side.

Here is the thing about statistics, depending on the question asked, the answers are completely opposite with significant results.

The Assistant Webmaster remarks:

I go slow, ol' Sogi!

James Sogi is a philosopher, Juris Doctor, surfer, trader, investor, musician, black belt, sailor, semi-centenarian. He lives on the mountain in Kona, Hawaii, with his family