Monthly Reversal Failures December 2018
Multiple software developers performed extensive back testing of the Armstrong Reversal System.
Statistically, on average, the system produces losses.
It is possible however to produce gains during specific limited periods of time. Still we consider it futile to discuss the performance of the system in great detail for multiple reasons.
First, Martin Armstrong uses the ambiguity of the trading rules around it to fraudulently misrepresent the performance of it in such a way that it appears in hindsight that it never failed, and he typically blames and abuses his clients in such cases.
Second, Martin Armstrong does not provide the historical data of the system for examination. We do have a large cache of that data.
Third he changes the rules of the system in hindsight to mark an obvious failure a success.
However, it is instructive to document a snapshot of the following large scale Monthly Bearish Reversals failure across multiple markets.
The Reversals were elected on Dec 31 2018 and the Profit/Loss for a short trade with a close date of Jan 31 2019, the one month unit of time for a Monthly Reversal is recorded for a selection of markets covered by Socrates:
| Symbol | Reversal | Close | Next Close | P/L% |
| BAC | 2511 | 2464 | 2847 | 15.5% loss |
| COMP | 680595 | 663527 | 728174 | 9.7% loss |
| $DJI | 2399720 | 2332746 | 2499967 | 7.2% loss |
| FCHI | 499506 | 473069 | 499272 | 5.5% loss |
| GS | 18151 | 16705 | 19801 | 18.5% loss |
| RUT | 149877 | 134856 | 149942 | 11.2% loss |
| $SPX | 268235 | 250685 | 270410 | 7.9% loss |
| TCMP | 149185 | 143229 | 155406 | 8.5% loss |
| XOI | 122281 | 115910 | 128401 | 10.8% loss |
| /CL | 5070 | 4541 | 5379 | 18.5% loss |
| /HO | 16940 | 16794 | 18774 | 11.8% loss |
The $DJI reversal election has been disputed by a Martin Armstrong agent on the grounds of a non-election of another reversal:
Quote
The 3rd monthly bearish at 21600 was not elected at the end of December in 2018 but elected 2 others including 23997.2. The market made an intraday low at the 21700 area in December holding the 3rd monthly bearish which cannot be argued against... I wonder how many other mistakes there are.. This is a false representation of performance. He is guilty of the very thing he accuses Armstrong of doing. Lol
The undisputed fact is that at this time, the implied rule, the "Elected Reversal Invalidation Rule" as I call it, which forces the invalidation of an elected Reversal by another non-elected Reversal, does not exist in any of the Socrates reference documentation The Reversal System. The rule is therefore made up in hindsight as usual - here for the single purpose of discrediting this entire analysis - and more generally to fraudulently misrepresent the performance of the Reversal System, creating the false impression that Reversals never fail.
Martin Armstrong is a charlatan, and he spent 11 years in jail for that reason but he has not changed.
Read this blog starting at page 273 to find out more about computerized fraud.
See armstrongecmscam.blogspot.com for a more compact view of major findings posted in this blog.