Jan

21

Palindromes, from Don Chu

January 21, 2009 |

Beyond the natural reading of the final-stressed-syllable rhyme, there is a wider range of rhyme types which, together with rhythm and meter, offers interesting prospects for reading market insights. Internal rhyme, where rhyme occurs within a single line or even as multiple rhyming patterns within and across lines and stanzas, seems to mirror the dynamic market state rather well. And one linguistic device which encapsulates internal rhythm and rhyme is the palindrome, especially the multiple-order palindromes of non-alphabet languages (one such palindrome, with 841 characters arranged in a 29 by 29 square, apparently contains 7958 poems – staggered/inversed/folded/turning/diagonal/etc.).

In the context of the markets, the simpler linear palindrome may offer a reductionist analogy to a common market structure like the range. Looking at the DAX H9 futures for the preceding three days (1/15, 1/16, 1/19), one sees an almost perfect harmonic waveform with regular amplitudes and periods – prices moving coherently in a range, much like a palindromic function. Of course, prices lost their palindromic stationarity today, breaking down through the range boundary in a loud tattarrattat-a.

One distinction that rhythm and rhyme confers upon poetic verse is a mnemonic-like structure which acts as a memory aid and allows for easier recall. And as commented, good assimilation and anticipation of recurring patterns, whether they occur in poetry, markets or video games, allows one that crucial edge necessary for success. Of course, some market days feel a lot more like Finnegans Wake or "Jabberwocky" than Mother Goose.


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  1. Gary Rogan on January 21, 2009 6:55 pm

    Usually a certain 78-year old Hungarian palindrome offers all kinds of analogies to various markets.

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