The Socrates Reversal System at times generates special signals that Martin Armstrong calls "Superposition Events". I prefer to explain these by example because their generation is confusing and complicated.
In physics, the superposition principle states that if there are two or more stimuli at a given point in time, the response will be the result of adding all the responses.
I want to emphasize: "at a given point in time".
Martin Armstrong has been selling Gold Reports for several years. These reports cover an entire year and are usually published in two parts, with updated Reversal values. He also sells Year End Reports. For the 2015 Gold report, recording the statistics of the reversals was amazing. Why did it work so well then? Because it was a full year's worth of steady price declines. Which is trivial for a trend following system.
Then the market turned. The system failed to predict the turn and Martin Armstrong APPARENTLY also missed the bounce, still writing bearish messages in the public blog while the price was already rising. From the trading perspective, this was devastating for his subscribers.
After the fact, months later, Martin Armstrong fraudulently misrepresents the performance of his service, claiming it was right all along because it had generated a long term Quarterly Bullish Reversal with a shorter time Quarterly Bearish Reversal, a "Superposition Event". This is a real Martin Armstrong model case.
Here is the time line:
Gold Report 2015 Update page 14 and below (emphasis added):
When we look at gold in dollars, we can see that the recent collapse into the week of July 20 that fell to 1072 shook the markets but supported the Uptrend Line from 2006. A closing for 2015 below 1184 will keep gold in a bearish position for 2016, warning that the final low may not come until the second Benchmark Cycle convergence. The monthly level oscillators are also still in a bearish position.
Year End Report 2015:
When we look at gold going into year-2015, we see absolute critical support at
1044. A year-end closing g beneath this level will signal new lows and they can
be quite dramatic. From a technical perspective, the two key targets will be
1026 and 601. Important resistance during 2016 will begin at 1179 with key
resistance forming at 1310. Therefore, even a year-end closing for 2015 below
1179 will keep gold in a bearish position.
Additionally, we have a Quarterly Bearish Reversal at 1112. Therefore, a yearend
closing below this level should also warn of a drop becomes possible at
least to test the 875 to 904 former high of 1980. A monthly closing beneath 904
would also point to a drop way down to the 680 area.
Gold elected the Quarterly Bearish Reversal, which is a sell signal.
Martin Armstrong was still bearish until the end of January when gold turned up. His story was that gold after the bounce would make a fresh low on the 2nd benchmark target fulfilling his prediction in the report:
Gold: The Bounce
Posted Jan 29, 2016 by Martin Armstrong
Naturally, the gold promoters are out in full force. The problem with their theories has always been that they are dead wrong. The REAL BULL MARKET will see the metals rise with equities. Right now, the promoters are focused on the stock market and yell, “Buy gold!” because a depression is here. We need to see a weekly closing above the 1143 level to raise any hope of a temporary low. Without that, we have a turning point in February that can be a high moving into the next benchmark target. A closing for January below the 1103 level will warn that there is inherent weakness still lingering within this market. Next month, watch the 1097 level for that is key support. Break that, and we are looking into a low into the second benchmark.
Still he did not mention the Quarterly Bullish Reversal, the Superposition Event.
But later, amazing things happened in hindsight:
Gold Report 2016 Part 1 Targeting the Reaction High and Final Low
Publish date: March 1, 2016 (emphasis added)
Another anomaly was that at the end of 2015, we elected the Quarterly Bearish
Reversal at 1112 closing at 1060.20. At the same time, that low generated a
minor Quarterly Bullish Reversal at 993. So we generated a long-term sell signal,
but a short-term buy signal. The next two Quarterly Bullish generated were at
1308 and 1347. That meant we should first rally typically for 2 to 3 months in a
reaction and if they failed to be elected by the close of March, then the longterm
trend should resume to retest support.
When he writes At the same time, he is not telling the truth.
Private Blog:
Gold Elects Monthly Bullish at $1207 On its Way to $1309
Tuesday, March 1, 2016
...
Our Quarter level of the model generated a Bullish Reversal at the end of the year reversing its short positions and going long. This also signaled that gold would rally from the $1060 area and should test the next Bullish Reversal at the $1347 level.
...
So here we have it the second time. Martin Armstrong claimed that his model reversed its Gold trade at the end of the year from short to long, while at the same time he had advised his clients to be short. Please note that would have been months before he published this event!
Nobody except him ever heard about that 993 elected Bullish Reversal, and about the model's reversal of its positions at the time when this information was needed. Please note that this Bullish Reversal is generated well below market price and it is elected at the same time when it is generated. The number 993 is an expected response of the Reversal system. And it is a reversal in a sense that is generated for clients to examine. But it was not included in the reports which comes in installments with videos, covering a year (not ending at end of year but going well into that period where we should have received that signal). That reversal was not available in any of the materials. So what was this "superposition" event then? It was generated in time but suppressed to provide that front running opportunity, in this case Poop and Scoop for Martin Armstrong.
By now it should be clear that in THIS case, Martin Armstrong's use of the term "Superposition" is misleading and extremely difficult to analyze because he uses the term for an effect that is clearly time-delayed - from the perspective of the objective observer.
The signal that he sends three months later was available to him but it was not available to subscribers at the time when he claims it was generated. So he effectively creates a system failure to profit from it. Being a person who traded precious metals for most of his life, and a person who spent 11 years defrauding clients with his commodity trades, this behavior should not come as a surprise. Here are some anecdotal references that document his agenda of getting his clients on the short side of the gold miners market:
First of all, someone is claiming that I put out some recommendation on DUST. I have NEVER recommended such an ETF and this appears to be a deliberate attempt to mislead people. You can search this blog; I have never made any recommendation involving any specific ETF. The motive behind this scam is curious to say the least.
The above quote is from Dec 24, 2015, right in time when he has the signal and prepares for the market turn.
DUST is a gold miners leveraged short ETF.
By denying that he said something that he never said, he actually said it, and he is effectively telling is audience what to trade.
And here is the theme, the template he was following, so I am not making this up. In
Gold – The So Called Analysts Who Only Say BUY! (archived version, original deleted) he wrote (emphasis added):
I was trading the metals 16 years ago. The institutions always watched me. I traded using Emerald Trading on the floor. These are from a short in silver. They would watch everything I did and try so hard to read me. The funny thing was I was pretty good at hiding my strategy. At the low, I was covering shorts and reversing into a long position. They assumed I was just covering shorts. I flipped my entire position of several thousand lots at the lows. I then had to show them I was long for they would not believe it by bidding aggressively. When they finally figured out I was long and not short, it was hilarious. I was on the phone and heard them screaming – “He’s f–king long. He’s f–king long!” You then saw a short cover rally that was spectacular
In
Wash Trades & Manipulation he wrote (emphasis added):
When I had to hedge Aristotle Onassis’ platinum positions, it was a nightmare because everyone knows the size of your position. This common knowledge makes it extremely difficult to trade. If you try to sell one ounce, they jump in front of you assuming the whole stockpile is coming. Hence, I would have to buy gold and then silver in small quantities, and then go in for a quote of platinum and sell. They saw I bought the other two and PRESUME I am a buyer. They immediately move the spreads (bid & ask) in ANTICIPATION I will be a buyer. I would then sell the platinum taking small losses on the gold and silver.
Whether the above is true or not, what matters here is that he is exposing his ambitions in that space.
And he is no stranger in that space. For more of the same by a different account, see:
The Enigma of Martin Armstrong
In case you still believe that Armstrong is not acting as a financial adviser against the law, Years later, Martin Armstrong once again claims that Socrates was correct, using yet more of the endless set of ambiguous signals while at the same time trying to gaslight one of his Socrates users:
Re: Martin Armstrong Discussion June 05, 2020, 05:04:18 PM
Just for the record AnonymousCoder will always be remembered as the fool who sold gold against Socrates Yearly Bearish Reversal at the end of December 2015 at 1044.5 which was not elected, that’s like selling the Dow at the end of the year just above its yearly bearish at 15480.
not only did u trade against the yearly bearish reversal you also traded against the ECM Major Turning Point date 2015.75 which gold was crashing into only to rally up into the next ECM Major Turning Point date 2020.05.
the real question is how stupid can you be to actually make this trade?
Saying that his clients who followed the advice that they they paid are stupid following that advice.
See also:
Socrates The Market Manipulator
Monthly Reversal Failures December 2018
Weekly Superposition Event in the DOW October 2018
Socrates Long Term Past Performance Review
Socrates Subscriber Testimonials
For a wider view of Martin Armstrong's incorrect Gold calls including this one by another observer, see:
Martin Armstrong - Gold Bear?
and
Martin Armstrong's gold crash didn't happen in September of 2015
For other types of Revision Signals, see:
Revision Signals
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