The Behavioral Analysis Model was developed over a thirty year period by JG Savoldi. The model predicts future price movements in human traded markets through the study of market participants' emotional responses during periods of high emotion and "capitulation."
These periods of elevated emotion and capitulation are the result of market participants' natural "mood swings" between optimism and pessimism—which are intrinsically driven by greed and fear—and the outcome is an emotional turning point commonly referred to as a “price reversal.” Once the key emotional response triggers a start point, the model then calculates a "count" from which subsequent consecutive higher or lower price moves dictate an eventual predicted reversal point. The model is continually tracking each individual bull and bear market within multiple fractal time frames. These time frames are typically based on price bar data including but not exclusive to monthly, weekly, daily, 618 min, 420 min, 240 min, 120 min, 60 min. 30 min, 20 min, 10 min, 5 min, 1 min, 30 sec, 15 sec, and 25 tick bars.
The B.A. model captures fractal-level data "footprints" created during these periods of elevated emotion and uses that data to predict future turning points as well as periods of strength and weakness.
The "guts" of the model are based on proprietary computations, the components of which include elements of—but are not exclusive to—the Fibonacci sequence and its golden ratio, fractal studies, and several unique capitulation thresholds. The B.A. model is equally effective in its ability to predict price movement whether the data input involves an individual stock, stock indexes, sector funds, currencies or commodities and can be used to trade or invest in any time period—intraday, intermediate, or long term.
As a rule, B.A. can be used to generate information about future price movement in any market as long as the primary traders in that market are human beings.
The more active and volatile, i.e. the more "emotional" the market, the better the results of the B.A. system in predicting future price movements and, because of this feature, predictions of future price movement are most sought after during periods of "apparent" chaos whether related to political, social or meteorological uncertainty.
