The Mood Pattern of Terror

There is an identifiable social mood pattern that is associated with social disruption.  The types of events included in social disruption are protests, strikes, riots, “random” mass violence, and terrorist activity.  An example of this pattern can be seen below in the monthly mood configuration for June.  The basic pattern is high Manic and low Controlled (with mood/effect inverted as it is currently).  When the second highest mood quality is Vulnerable, it ends up being more ideological (e.g. protests and strikes).  When the second highest quality is Expansive, it tends to be more violent.
 

Time scale is important as well.  When this pattern shows up on a daily scale, the events that may arise near that date could be of little significance to the general public and may not even make the news.  On a weekly scale, something in the socially disruptive category is more likely to show up in the news.  On a monthly scale, such as what we have in June, there is almost certainty that a highly significant event or events of this type will be in the news, and will have an emotional impact, at the very least, on the American people (since the measure is U.S. mood).

On June 12th, around 2am, the tragic and unfortunate shooting in Orlando occurred.  One can hope that the largest mass shooting in American history would be sufficient to satisfy a monthly scale disruptive mood configuration.  Yet, while not a certainty, there is an indication that something else may be next.  The exact same social mood pattern for the month of June showed up on a daily scale on June 11th, the day before the Orlando shooting.  It shows up again on June 26th (see June daily mood timeline below).  While a daily scale configuration is not usually of newsworthy significance, when it matches the larger pattern, it may be an indication of specifically when it may show up as part of the news cycle.

This is not being shared to create fear or terror.  It is a reminder to use the due diligence that is always important.  That is, staying aware of our environment and looking for unusual activity or behavior in the people around us, and for anything especially out of place.  This is especially true for the next couple of days.

How does this relate to markets and trading?  There is often (but not always) a climax event at a near term bottom, which also happens to be likely in the next few days.

Update: 6/26/16 3pm Pacific Time 
It's not terrorism, but this certainly fulfills the criteria.  Hopefully with no one dying this time: Protesters, white supremacists clash at State Capitol.  Officials: 5 people stabbed, 2 critically injured

Update: 6/28/16
No such luck.  Terrorism strikes again.
Suicide bombs kills 28, wound dozens at Istanbul airport

U.S. Market and Mood: June 21-27, 2015

Change is in the air as the week begins.  Instability, large moves, and uncertainty are all likely themes (see chart left), especially in the first half of the week.  Tension and anticipation build near the end of the week. 

A large directional move is indicated in the markets this week.  The increasing sense of vulnerability (chart below, right) is most often associated with risk-aversion, decreased spending, and down markets.

U.S. Market and Mood (June 14-20, 2015)

The week begins with an effort to put on a positive, "yes we can" attitude.  There may be some lingering, ongoing economic concerns and domestic issues, but the sense is that they can be addressed and turned around.  Competing with this resolve to look at the bright side, is a background of destabilizing factors, some of which comes from outside the U.S.  People begin to get agitated and anxious as the week goes on.  Midweek could even see a "mild panic" or moment of passion (strong emotions), as a general sense of increasing vulnerability begins to take hold  By week's end, risk aversion is becoming more pronounced, and markets are getting more decidedly bearish.  People have fixed ideas and opinions of "the facts," and are more willing to talk about them.  Protests and demonstrations are on the increase.

Analysis of U.S.-China relations shows China posturing in a more aggressive tone near June 18.

U.S. Market and Mood (June 1-13, 2015)

Social mood patterns for the first week of June indicates anxiety and restlessness.  Markets should be choppy for the most part with little clear direction.  Sometime near the end of the first week or very early in the second week, a directional move should occur.  The most  likely direction is down, as this transitory pattern is most often associated with bearish markets and risk aversion.  Spatial analysis by the MoodCompass team shows economic concerns likely arising from outside the United States having some effect on U.S. markets (see The Crow's Nest blog entry for June).

By midweek the week of June 7 and continuing through the end of the week, a "new paradigm" pattern is in play.  This marks a new chapter in U.S. social mood.  Things should become a lot clearer as to global conditions and market direction as the week plays out.   A shift to this new outlook and new priorities will be in process.  Be ready for something different!

Analysis of U.S. - China relations shows a significant development near June 11.