The Forreast Signal System: 12 Detectors Explained
More data does not reduce uncertainty. Most of it increases it. The signal is there — but the noise is winning.
This is the core problem the Forreast signal system was built to solve. We do not build one model and hope it catches everything. We deploy 12 specialized detectors, each tuned for a specific class of pattern. Each one scans the WorldGraph continuously, looking for the specific signatures that indicate something is about to change.
When a detector fires, it does not just flag an event. It traces the causal path through the graph — showing you exactly how the signal reaches your position, what it means, and what you can do about it.
The 12 Detectors
1. Critical Slowing Down Detector
What it detects: Systems that are about to fail.
Complex systems telegraph their own collapse. Before a system breaks, it slows down. Recovery from small perturbations takes longer. Autocorrelation increases. Variance increases. These are the early warning signals — and this detector scans for them across every node in the WorldGraph.
Example: A banking sector that takes longer to recover from each small shock is approaching a critical transition. The detector fires weeks before the systemic event.
2. Network Topology Shift Detector
What it detects: Structural changes in how entities are connected.
Networks have topology — the pattern of connections between nodes. When that topology shifts, it means the underlying structure of the system is changing. This detector monitors the graph for structural transitions: communities fragmenting, new hubs forming, critical bridges disappearing.
Example: A supplier network that was diversified begins to concentrate — three companies now control 80% of a critical input. The detector fires when the concentration crosses the threshold.
3. Capital Flow Anomaly Detector
What it detects: Money moving in unusual directions.
Capital is fluid. It migrates between markets, geographies, and asset classes following pressure gradients. When it moves in unusual patterns — large flows into unexpected destinations, sudden withdrawals from long-stable positions — something has changed in the system's assessment of risk and opportunity.
Example: Sudden large capital outflows from a specific emerging market, weeks before a currency crisis becomes public.
4. Regulatory Vector Formation Detector
What it detects: Policy changes that create new threats or opportunities.
Regulation does not appear from nowhere. It forms along predictable vectors — advocacy coalitions, legislative momentum, regulatory agency priorities, judicial precedent. This detector maps those vectors and fires when a regulatory change is forming that will affect your position.
Example: Export controls on critical technology components are being drafted. The detector fires during the committee stage, months before implementation.
5. Supply Chain Chokepoint Stress Detector
What it detects: Concentration risk in critical inputs.
Every supply chain has chokepoints — points where a disruption cascades. This detector maps those chokepoints and monitors them for stress: capacity utilization above threshold, single-source dependency, geopolitical exposure, inventory drawdowns.
Example: 100% reliance on a single supplier in a region with rising geopolitical tension. The detector fires when the tension crosses a risk threshold.
6. Correlation Breakdown Detector
What it detects: Relationships that have historically held but are now breaking.
Many risk management strategies depend on historical correlations. When those correlations break — assets that used to move together now diverge, or assets that were independent now move in lockstep — the system is entering a regime change. This detector flags the break before it invalidates your models.
Example: Two asset classes that were negatively correlated (and provided diversification) begin moving in the same direction. Your hedge is no longer a hedge.
7. Information Asymmetry Surface Detector
What it detects: Gaps between what is publicly known and what is structurally true.
Information asymmetry is the gap between what the market knows and what is actually happening. This detector maps that gap by comparing on-chain data, regulatory filings, and structural analysis against public narratives. When the gap widens, it means the market is mispricing something.
Example: A company's public filings show healthy growth, but the WorldGraph reveals that three of its top five customers are in financial distress. The gap is the signal.
8. Actor Network Convergence Detector
What it detects: Multiple actors independently aligning on the same position.
When independent actors — who are not coordinating — begin aligning on the same position, it means the system is producing convergent incentives. This is often the strongest signal of an upcoming systemic move. This detector maps actor positions and flags convergence.
Example: Three unrelated hedge funds, a sovereign wealth fund, and a corporate treasury all begin increasing exposure to the same commodity. No coordination — but the system is telling them all the same thing.
9. Volatility Regime Change Detector
What it detects: Transitions between volatility regimes.
Markets alternate between regimes: low-volatility trending, high-volatility mean-reverting, crisis-driven non-stationary. This detector identifies regime transitions as they begin — not after they have fully formed. The transition itself is the signal.
Example: A market that has been in a low-volatility trending regime for 18 months begins showing signs of regime transition. The detector fires at the inflection point.
10. Liquidity Drain Detector
What it detects: Reductions in market liquidity that precede dislocations.
Liquidity disappears before crashes. Not all at once — it drains, quietly, from specific instruments and specific markets. This detector monitors liquidity conditions across the WorldGraph and flags drains that are likely to produce dislocations.
Example: Bid-ask spreads widening in a specific bond market, with depth declining at the same time. The detector fires before the liquidity crisis becomes visible.
11. Narrative Divergence Detector
What it detects: Gaps between the public narrative and the structural reality.
The narrative is what people say. The structure is what is actually happening. When they diverge, the gap is the signal. This detector compares narrative sentiment (media, analyst reports, public statements) against structural indicators (WorldGraph data, capital flows, regulatory filings).
Example: The narrative says a sector is booming. The structural data — new orders, inventory build, customer financials — says the sector is peaking. The detector flags the divergence.
12. Compound Stress Detector
What it detects: The convergence of multiple low-level signals into a systemic event.
The most dangerous events are not single-signal events. They are compound events — when multiple low-level signals, each individually below threshold, converge to produce a systemic cascade. This detector correlates across all other detectors and flags when the combined signal strength crosses a systemic threshold.
Example: Capital flow anomaly + supply chain chokepoint stress + regulatory vector formation. Individually, each is manageable. Together, they indicate a systemic event is forming.
How the Detectors Work Together
The 12 detectors are not independent. They form a system — each one feeding into the others, each one providing context that makes the others more accurate. The compound stress detector is the integration layer, correlating across all detectors to identify systemic events before they manifest.
When a detector fires, the system:
1. Traces the causal path through the WorldGraph to your specific position
2. Assesses the confidence level — how strong is the signal, how reliable is the data
3. Identifies the falsification condition — what would prove the signal wrong
4. Generates the alert — the signal, the confidence, the falsification condition, and the recommended action
The Difference
A traditional alert system tells you something happened. The Forreast signal system tells you:
This is the difference between a smoke alarm and a steward. A smoke alarm tells you the house is on fire. A steward tells you the wiring is degrading, the fire is likely, and the electrician is already on the way.
*Forreast Intelligence — 1209 Delaware Ave, Wilmington, DE 19806 — sovereign@forreast.com*