This is based on T-Theory concepts of Terry Laundry, who discovered these Rate T's back in 1970's (I think) and used this concept quite successfully for many years. Generally it states that a period of time it takes for interest Rates to fall from high to low is approximately equal to period of time from interest Rate low to important low in Stocks.
He acknowledged difficulties with accuracy of these projections since rates went into historic downtrend in 1980's and also during times of heavy intervention.
1st High to 1st Low in Rate = 1st Bottom in Stocks (in 2015)
Highest High to Panic Low in Rate = 1st Bottom in Stocks (in 2015)
Last High to Lowest Low in Rate = Final Lowest Low in Stocks (in 2016)
Berg,
ReplyDeleteOriginal T's were based on the Transportation average.
"By
the
mid
1970’s
I
had
replaced
the
Transport
T
with
the
Simple
T’s
constructed
in
the
Value
Line
Unweighted
Average.
I
will
present
these
later.
In
1975
it
suggested
the
6-‐
year
decline
into
the
late
1974
low
could
result
in
a
time
matching
6-‐year
year
equity
advance
into
a
September
1980
peak.
This
proved
profitable
and
reasonably
accurate
with
the
actual
peak
coming
in
the
later
1980
early
1981
time
period.
The
new
bear
market
that
followed
into
the
August
1982
low
to
me
proved
the
concepts
validity."