This is NOT an AlphaAdder Post. AlphaAdder deals with Self Organizing towards Six sigma events.
This speaks to REVERSE AlphaAdder which deals with Volatility Clusters; their probable decay length, aftershocks, echoes and the diabolical percolating risk that hides unseen during rebounds in this phase. One of Several Pioneering Risk Management tools developed during the Seventeen year Applied Experiment.
Autoregressive behavior like the Efficient Market Hypothesis, works, UNTIL IT DOESN'T, CATOSTROPHICALLY. Many clever ride that train into the ground, amassing millions, then poof. Every Cycle. Every Cycle. Watched it for thirty years. AlphaAdder helps one disembark the train before it runs off the rails, over the cliff, or into another train.
It speaks to the length of the current cluster, that an unforeseen event can have multiplicative explosive affects. This despite watching Volatility decompress and markets rebound. It is much more fragile than you can see on the surface. This Vol cluster unseen percolating beneath the surface risk lasts until 8/11.
Should an unforeseen event happen Volatility will explode. This could morph into the Six Sigma event, or it decompresses, and Six Sigma event is recalculated by AlphaAdder. I, of course would update here.
Don't be walking in front of this steam roller picking up Nickels, you might slip. Risk Reward ratio is immensely upside down.
As it stands right now Inflection Points within the Current Decaying Vol Cluster are:
5/31 which is beginning of Next Week. This weeklong deadcat bounce is ending essentially now.
Next IP shortly after that 6/16 I expect another brief Deadcat bounce.
Volatility Should Continue Decompressing down into 7/8-12
And be free to explode after that in Mid July- Mid August. Which Dovetails nicely with the previously mentioned AlphaAdder perspective, which gives me further confidence in my Six Sigma event forecast.
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