Let’s look at the last 12 months and pick the best forecast results. But before we do that let’s first talk about the statistics of what we do so we can better under understand the implications of it all in the grand scheme of things.

We use 15 minute bars for our charts. There are about 130 bars in a week, so if you nail the direction for the week and the pivot/turn point to the bar (a perfect forecast for one pivot point) then the math comes out to be  (2*1/135)  a 1 in 270 chance from random (by the way, the 2 is for the direction of the forecast).  Therefore, picking at random, you’d expect to guess this correctly about 3.7 times in about 2 years time, or just under twice a year.

As this is achieved progressively with any accuracy, the odds against achieving this become staggering.  For example, if you were to pick two consecutive weekly market turning points with perfect accuracy, the probability of achieving this would be 2* 1/270 * 1/269, or 1 in 36,315.  That is one time in 36,315, 2 week periods or, once in many lifetimes!  Beyond this, the computations become increasingly complex, but as you can see, the odds against achieving consecutive accurate forecasts defies any reasonable measure very quickly.

Yes you can possibly get dumb (or smart) luck or pick up a tip or just use your experience/intuition but most people do not have those skills yet. I wouldn’t rely on indicators/oscillators for this task either, read Rob’s post where he takes apart this long-living myth.

This is where G-Lines come in. Keeping the 1 in 270 chance in mind let’s look at our Top 5 forecasts in the last 12 months. We will start in descending order -

#5. May 2008. Monday - a holiday, projected low on Tuesday comes in as projected missing by a couple of bars - market takes off for 40 points. Thursday afternoon market makes a projected high to the minute! While reversing on a dime we pick up another 5 points by Friday close for a total of 45 points or $2,250 per contract -

#4. October 2007. Monday low comes in to the bar, Friday high comes in to the bar. Market tried to deviate from the G-Line but it snapped back right to it just as fast. Total for the week - 50 points or $2,500 per contract -

#3. August 2008. Monday high comes in within several bars though going up a bit more than expected, in terms of the forecast it was nearly perfect. Market declines into both of the projected lows of Wednesday and Thursday giving us a nice 35 point drop. market starts taking off a bit early but still within projected lows. In fact if you look closely Friday and Thursday switched around - that happens sometimes. Further, market goes up into projected Friday high for another 25 points. The reason why this forecast is at number 3 spot is because we nailed 3 pivots in 1 week (I won’t even tell you the odds on that one!). Profit total - 60 points or $3,000 per contract -

#2. October 2007. High comes in on Monday open as forecasted and low comes in on Friday close to the bar! Simply put - perfect forecast. Profit total - 60+ points or $3,000 -

#1.

Monday looks pretty good - total match. Up from there into Wednesday high area for a nice 15 point pop. Then here is where all the fun begins. While “trend followers” are jumping head over heals on this market at the end of Wednesday, we know what is coming - instant death! Market plunges over 60 points by Friday projected low completing our forecast. Total profit - 75+ points or $3,750 per contract -

We do our best to have these type of forecasts as often as possible, but we cannot control the market ;-) . We just show what the market SHOULD do, it is up to it to follow our forecasts. When you think in terms of statistics and probabilities you will start to grasp the task at hand, however, we have proven in this post that predicting market perfectly is absolutely possible.

For more of our recent history go here http://eminiforecaster.com/history.html