June 2006 – T Theory® Update
T Theory Observations for mid June 2006
Since my mid May posting we have seen a market being hammered by the two large Rate Ts aiming for separate projected lows near early August and early November. As I suspected the greatest damage has so far been seen in the Asia and Asia driven sectors, but the US market has also seen its key equity indexes drop below their 200 day/40week moving averages.
In any case the Advance-Decline Ts long term bullish forecast of an eventual high well into 2007 is being “dented” right now which argues for increasing the significance of the Rate T’s forecast within T Theory.
You may remember that earlier this year, in my initial study of the Rate Ts posted at TTheoryFoundation.org, it was apparent that advanced knowledge of market low dates, despite their typical few weeks of time projection errors, made Rates T potential more important than conventional Ts. Right now we are seeing a good example of their higher priority so it is a good time for me to summarize some of my thinking before I begin a second generation project this Fall.
In my initial Rate T Theory, summarized at my TTheoryFoundation blog, we saw success at projecting a simple series of future dates at which key market lows might be expected. The second generation of Rate Ts will go on to propose a mechanism for the propagation of the left end rate peak to the eventual time symmetrical negative impact on equities. From that model new predictive information will likely flow and Rate T Theory will become more useful. This research will always be posted at the Foundation site and some reports will be posted this Summer.
In the meantime the simple Rate T projections have already helped me cope with some short term ambiguities that are showing up as we move to the twin projections of an early August and early November low. If you have been keeping the Volume Oscillator you know the rally from late May low unsuccessfully tried to form a bullish T. It was obviously destined to fail simply because the Rate Ts projection of a low within two months obliterated any possible new Short Range T’s sustainable rally.
By a similar argument the upcoming projected low in late July/early August time period will be inhibited from making any important sustainable advance this summer because two months later, the second big rate T will be pressing for a late October/early November low. That low will typically see its decline start about 6 weeks earlier, so their won’t be much time for a Summer rally.
We also know that the long spanning Rate Ts produce the most severe corrections, and the way this correction is shaping up it appears the twin Rate Ts are acting like some “killer asteroid” bend on destroying all investment life forms over the next few months. Nevertheless they are probably only fulfilling the normal 4 year cycle that has, since 1949, produced important lows at about 4 year intervals. So we should see a good buying opportunity at the Fall low regardless of the severity.
Moving on to Gold, I was disappointed that it appears to be pulling all the way back to its normal bull market support at its 65 week moving average, currently at $525/oz and rising. Because the big Gold T is the longest spanning and potentially the strongest T, I was hoping for better. At some point Gold will need to disconnect from the stock market’s trend, so evidence for independent movement from the $525 level or perhaps from the Rate T’s late July low would be interesting and welcome.
It would be more bullish for a Gold recovery if it started to firm well before $525 is reached and started to base while the moving average rises up to a higher support level. This base would also be helpful in support the HUI T discussed earlier. You can follow this picture yourself by going to stockcharts.com and calling up a weekly chart of $GOLD with a 65 week exponential Moving Average.
Otherwise we need to just let the Rate Ts play out to their projected dates and determine whether their combined effects on equities are going to be as severe as seems thus far. Terry Laundry
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I claim no credit for the material found under T Theory® on this blog. All of this material is the creation of Terry Laundry and was downloaded from Terry’s free blog site (TypePad). I have created a mirror of Terry’s original material and now there is a second site containing Terry’s T Theory®. One or both of these websites hopefully will survive through time as Terry’s material is too important to be lost to the ravages of time. This site is simply a memorial to his lifetime work.
The page content re-blogged here is exactly as Terry created on his original webpages (saved on my computer with ScrapBook)). Nothing has been left out from the period Dec 2003 to June 2011. From Terry’s site, I made a lot of formatting changes, creating a more easily readable webpage appearance. The PDF chart duplicates of the JPEGs have been omitted for ease and speed of recreating Terry’s pages. References to PDF charts should be ignored (but no chart was left out).
After June 2011, Terry created a paid subscription website. None of that material is found here.
There were many many, many hours spent on this project; downloading Terry’s individual charts & audio files, followed by the uploading of Terry’s charts and audio to my WordPress blog library, after which I had to insert the uploaded material into my new T Theory® webpages (hopefully in the correct places). This was a dull and arduous project and I hope you enjoy it. I don’t believe there remains any more of Terry’s material in free domain, so my T Theory® project is probably finished. If I’ve missed something, you can leave me a comment.
If you find an uploaded reference error (chart or audio in the wrong place), please note the month and year of the webpage, plus the exact name of the referenced error file. Include any other info that will help me locate the problem file and where it occurs on the webpage. Leave a comment for me with the info and I’ll fix it.
Terry’s material is very long and will take many weeks for you to finish. Don’t hurry, it’s not a marathon and you will absorb more if you go through it at a reasonable rate. This is especially true for those who don’t invest in the T Theory® reference encyclopedia. The encyclopedia is a written reference for T Theory® and includes everything of importance for Terry’s T Theory®. Without the reference encyclopedia you must depend on your memory and Terry’s method carries some rules that you could easily violate. The encyclopedia also includes new information never seen on his website.
You are welcome to save any or all of my blog material to your computer. You also have my permission to re-blog my information, but you must (1) credit me and my blog in an obvious manner and (2) don’t change my material.
FYI – I find the best way to save a webpage is using “ScrapBook” (it’s an add-on for the FireFox browser). ScrapBook saves a webpage to your computer EXACTLY as it appears on the day you saved it. You can’t tell the difference between the internet webpage and your ScrapBook saved webpage. The saved pages are not pictures. Instead the pages consist of HTML and page functionality remains identical on your computer. There is also a second method for using ScrapBook, where you can save all of the webpages down to a defined link depth. This optional method means all links will function on your computer to the link depth specified (meaning you can click on links on your saved webpages and tunnel down into pages within pages). Saving the normal way will only save the top webpage but the links that exist could continue to function by taking you to the website on the internet instead of on your computer. But sometimes the linked website doesn’t exist anymore. I’ve had this happen on some very good webpages with unique information (they just disappear into the internet void). That’s a bummer when you lost some really good info and thus rose my need for ScrapBook. You can also filter the pages saved using the optional ScrapBook method, which can exclude all pages not coming directly from the specified website (filtering is recommended using this method otherwise you wind up with a LOT of useless stuff).
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