I take the value of an important high/low point on the price chart and multiply it by 0.034442. For calendar day analysis, I have found that the best factor to use is 0.618034 raised to the seventh power (= 0.034442). The smaller numbers produce shorter time-span turning points. With so many scaling factors to choose from, the question, then, which one to use? Le Corbusier was right the gods of numerology have the solution: It matters not which scaling factor one uses, because they all produce the same turning points. 618034 raised to powers of itself that is the key. My research has shown the fibonacci constant that is the key factor. The question, then, what scaling factor to use? To fix this problem requires the application of a scaling factor. In working with the stock indices, for example, the price units are so large that the direct conversion of the price units into time units produces an expected trend change date/hour that is very distant and of little use. The major problem inherent in the squaring of price and time involves the application of a scaling factor, or multiplier, to the raw data.
“Behind the wall the gods play they play with numbers of which the universe is made up.” - Le Corbusier As a scientist in the financial markets, I share my work product with fellow colleagues because I know it will come back to me many times over. I suspect I’ve done more research in this area than just about anyone, including W. I am going to share with Crystal Ball readers the results of my research, which has been, very expensive - I think you know what I mean. I have spent literally hundreds and hundreds - no thousands - of hours researching the mathematical relationship between price and time. But, it is a very, very useful tool none-the-less. It also does not project the magnitude of the move following the trend change. The advance projection does not indicate whether that trend change will be a high or low one must incorporate the use of additional tools, e.g., pattern analysis, cycles, range oscillators and/or measurement of price velocity to make that determination. Squaring price and time is a technique that alerts me to the potential - but not the certainty - for a change in trend. I find it useful not only in projecting trend reversals in individual stocks, the indices, and commodities, but predicting reversals in the trends of the casino games like roulette and craps as well, demonstrating that time and price are inextricably related.
This technique involves counting forward in time an equal number of time units as units of price from an important high or low. The following are examples of the types of messages that are often posted in the course of a typical day at the Crystal Ball Forum.