Timing on IMM British Pound

Bifurcation based on Chaos Theory

This is an example of Bifurcation on IMM BP. We plant our first pivot point on the Low week of Feb 8th, 1993 and our second pivot point on the High week of March 6th 1995. The system projects an arc of equal time forward from March 6th, 1995 thru March 24th, 1997. The end point of the arc (March 24th, 1997) is often a natural time for a change in trend, and the point at which the arc is bisected by the line is almost always a critical turning point in time. In this case that point in time is the week of September 2nd, 1996.

Now we look to other timing models to see what they tell us about the week of September 2nd, 1996. In fact our Timing Arrays show Panic, High Volatility and Directional Change the week of August 26th, 1996 just one week prior. An indication for Panic on the weekly timeframe suggests an Outside Reversal week (or a week when the High and the Low are “outside” the range of the previous week). High Volatility and Directional Change only reinforce the likelihood of a turning point.

So how do we use this information? If you are long Sterling and it rallies into the end of August you may want to take some profit just prior to this two week timeframe (Aug 26th thru wk of Sept 2nd). A significant turning point is likely in this timeframe. If Sterling rallies into this timeframe it will likely decline coming out of it; if Sterling goes down into this timeframe, it will likely rally coming out it.