US Equities Fractal.

I am going to revisit something I posted earlier this week. The link is here, the item I refer to is the additional point regarding the S+P500 at the very foot of the article, regarding a repeating pattern I had in the S+P which intimated we may about to head lower. Though I was myself somewhat reticent about whether this had any validity, the S+P has fallen some 40+points since then without any correction.

In terms of Technical Analysis, the chart referred to is a 'Fractal Pattern'. A fractal is a rough or fragmented geometric shape that can be split into parts, each of which is (at least approximately) a reduced-size copy of the whole. I recall looking at a similar analysis in relation to the Bank Index a few years back, prior to the spectacular crash in that index during the 2007/2008 bear market. My original analysis at that time was looking at the Bank Index and a rare '3 Peaks and A Domed House Pattern'. I noticed that this pattern, or some variation of it which overall was similar in formation, existed as one zoomed in closer and closer from the Multi-year chart right down to the intra-day chart. I have tried to emphasise this in the charts below (It will help to click on the charts to see them larger) .

 Below I have redrawn the S&P Index, however I have used the NYSE composite for the larger period, and the S&P Sep future for the shorter periods, since I think this captures the essence of what I am looking at better.
The implication of this Fractal analysis is that we appear to have a Head & Shoulder pattern embedded in the right shoulder of the next higher scale Head & Shoulder pattern, and so forth from intra-day up to multi-year. A highly respected ex-colleague of mine told me once that embedded patterns within other embedded patterns can be very dynamic.

This fractal analysis may work, it may not work, or it could be a misanalysis, however the implications if it does work are stark. --- My reading of this at the moment is as follows; the current move in the S&P should continue on to around 1040ish, possibly with a small bump or two along the way but not too much. After a pause and consolidation around/above 1040ish, then a further drop should begin, which could see a move towards around the 800 level ( I consider the 666 low an overshoot). After further consolidation around 800 there would then possibly be one further move to around 450-500. -- I will add that this is of course highly speculative, it is reliant on whether this analysis is valid, it is reliant on me correctly reading this analysis and reaching the right conclusions (for example this current move could be a Left shoulder forming, etc) , and of course it is reliant on whether it continues to perform in the manner consistent with prior performance.

On that note, I will finish this posting for now... Finally good luck to our boys for Sunday in the World Cup v Germany............

-- COME ON ENGLAND--.