A Broad Overview of Ermanometry
Plato, the Republic, Speaking of Geometricians:
“Do you not know also that although they make use of the visible forms and reason about them, they are thinking not of these, but of the ideals which they resemble; not of the figures which they draw, but of absolute square and the absolute diameter... they really seek to behold the things themselves which can be seen only with the eye of the mind.”
Ermanometry is an original work of technical analysis of the financial markets based on three decades of research by William T. Erman. This research provides compelling evidence that markets movements are governed by natural laws and thus perfectly patterned. Just as a spider spins a geometrically perfect web with apparently no conscious knowledge of the wondrous feat it performs, Ermanometry holds that humans interact in a way that creates geometrically perfect movements and cycles in their economic transactions. This premise is documented by evidence that relates major moves in the U.S. stock markets over the past century and has been found to be equally effective in explaining the movements of all freely traded markets, including Forex, commodities, financials, and index futures. Per the following email from Dr. Xavier Hebras, Ermanometry concepts may equally apply to disciplines beyond the mercantile world.
Email from French physicist, Dr. Xavier Hebras
Hello Mister Erman
First, i would like to explain why i have contacted 2 days ago.
Actually i'm currently working with Dr Phillipe Bobola on the doubling theory of time. Quantum physics has demonstrated that matter and energy was discontinuous. However, time remains continous into this system. The recent discovery of the "doubling theory" completes the basic principles of modern physics without throwing away existing laws. This theory introduces a discontinuous of time which is defined by a sucession of observation instants separated by non observations instants. Our lighting (50Hz) is apprently continuous :switching off 50 times per second this lighting is discontinuous or stroboscopic. ( a stroboscopic lighting alternates luminous flashes ans dark times) In the same way we can define a stroboscopic time. This discontinuous time is apparently is apparently continuous for an observer which is moving in this time. The frequency of this temporal stroboscopy is the fundamental characteristic of the time flow into the horizon of the observation.
In all physicall phenomena (as well subatomic as cosmological ) the stroboscopic time flows theory may explain different current observations and paradoxes. The applications are huge, for example this theory can explain the relativistic correction in relativity; (this correction was used to fit the data without explanations until know), this theory can explain also the Einstein Podolsky and Rosen paradoxe in quantum mechanism. This thoery has been by Dr Bobola to explain the homeopathy and how temporal openings of Doubling theory brings a new explanation of principle of dilution.
This theory affect of the aspect of our life just because we llive "in" the time. The doubling theory of "time" is probably the missing link to explain your wonderfull observations. Don't be affraid to use log scale for the time axis...
A grow phenomena is a development into the time which can be accelerate or decelerate and golden ratio is an image of this behavior. (like shell, galaxy etc...) I join a document where you can find some explanations about the theory; you have a beautilfull section about an easy way to demonstrate the Kepler laws the theory. Unfortunatly this document is into french for the moment.
why my interest for the markets ?
I have read a book of B. Mendelbrot on fractal and market. He use a multifractal sytem to model the markets. intrinsecly this model use a "time" which is not linear. The time can be accelerate or decelerate. With the doubling theory, we can say why and when accelerate or decelerate time.
I made different researches on the internet to improve my knowledge about the behaviour of the markets and i have found your work.
I'am convince now that thank to all your observations, it will be possible to find the links between the doubling theory of time and the market behaviour. It is the reason why i'am looking for your book or all informations (/publication) you would like to share.
Nevertheless, i hope to find time to work on this issue during April. We are also working on a knew publication about consequences of the doubling theory of time in quantum mechanics. This appreach revisit the notion of probability and can be extended to different field in science. I will send you the draft if you want.
All the best,
Dr Hebras xavier.
Ermanometry introduces a number of original and unique concepts to the understanding of financial markets, including the following:
Market movements are viewed as spherical, following the logarithmic spiral that occurs pervasively in nature.
Market movements are visualized in a three-dimensional perspective, revealing proportions in trading days that relate one market movement to another.
Click this chart to magnify it:
Ermanometry and Strategic Trading
A Complete Trading Methodology - Intermediate and Long Term Trading
Ermanometry can be a complete trading method for intermediate term traders and long term investors. The January 14, 2000 and March 24, 2000 tops illustrate how the method's concepts are applied. Both of these tops and the October 10, 2002 bottom were macro Ezones. (Ezones are explained in the Concepts section.) The market reversed on these days and therefore the Ezones were validated as pivotal days. However, the trader acting on Ermanometry timing work alone would have had to wait at least one day to make certain that the extreme intraday prices of these days was not violated. Entry positions would be placed one or two days after the pivotal days, with a stop/reverse order placed at prices just one tick beyond the extremes of the pivotal days.
The necessity to wait until the Ezone was validated would probably result in entry prices further away from the extreme prices than the trader would desire. However, the trader would still be entering the market on the right side and very close to the start of a major trend. Usually these entry points "miss" no more than ten percent of an entire move. An additional comfort is the ability to place a stop/reverse relatively close to the original entry point.
Once the Ezone concept has provided the trader with a guide to the direction of the major trend, additional technical tools can fine tune and greatly enhance the profitability of entry/exit points.
Ermanometry: An Invaluable Tool For Use With Other Technical Indicators
Ermanometry should not be used as a stand alone system for short term trading and day trading. When additional technical tools, from simple bar chart or point and figure chart formations to complex combinations of oscillators are combined with Ermanometry, the combination will enable the trader to maximize trading profitability.
Indications from other technical tools will enable the analyst to project the probabilities of each of the possible scenarios that could unfold when the market trend reaches an Ezone. There have been innumerable occasions when it has been possible to predict the Ezone's impact upon the trend days and weeks in advance.
Major and macro Ezones are potential action points for intermediate term traders and long term investors. The greater the degree of the Ezone, the earlier its potential market impact can be anticipated. Therefore, all traders and investors, not just short term traders, are strongly urged to combine other technical tools with Ermanometry.
If the market is moving up, and other technical tools indicate an overbought condition, a new extreme price during an Ezone offers a very low risk opportunity to maximize profit on existing long positions and for entering short positions. Without other technical tools, the trader must wait at least one day before taking action. In view of the current volatility, the time lag could cost the short term trader a large proportion of potential profits.
The benefits of Ermanometry were noted in the section on Invisible Ezones. The entire range of these benefits is increased when other technical tools are combined with Ermanometry.
These and other key concepts are covered in this web site by following the links at the top.
Articles - Includes several articles published in trade magazines and newspapers.
Examples - Describes the concepts, principles and application of Ermanometry in more detail with supporting historical charts.
Commentaries - Includes independent commentaries from industry experts and users familiar with the principles and applications of Ermanometry. These and other key concepts are covered in this web site by following the links at the top.
