Illustration of Why Predicting Stock Market Direction Is Futile
Randomness :" I returned, and saw under the sun, that the race is not to the swift, nor the battle to the strong, neither yet bread to the wise, nor yet riches to men of understanding, nor yet favour to men of skill; but time and chance happeneth to them all."~~ Ecclesiastes 9:11 Non-linear Feedback Loops : “I tell you everyone who has, shall more be given, but from him who has nothing, even what he has shall be taken.” ~~Matthew 25:29 Cycles :"When the seven years of abundance enjoyed by the land of Egypt came to an end, the seven years of famine set in.."~~ Genesis 41:53/54 1. I-Dimensional Continuous Wavelet Transform of SP500 January 06-July 08 2. S&P500 Weekly Data: Jan 2006 to July 09 2008 (133 data points) 3. Wavelet-based Synthesized Time Series Example A 4. Wavelet-based Synthesized Time Series Example B 5 . Wavelet-based Synthesized Time Series Example C The reason why the stock market's direction (as represented by an Index) cannot be pr...