Let me explain. I've been spending hours over tons of chartings. Now before you call me a wacko and a pumper, let tell you what I've found.
O.K. anyone of you can pull up some charts and check this yourself. The head and shoulders formation was just finishing it's formation when suddenly earnings season began. Now if you look at the charts you'll see that now it sorta looks like a H&S however it has an arm! Yes, an Arm. A straight shot upward, senseless + low volumne! So, I'm like WTF? Never seen this before...So I go back 70yrs of Charts, O.K. the last time this happens is the second half of 1948. So I compare the two 1948 and 2009!! Identical. Now what happens after the arm or Steep climb if you will? Major drop!! So to conclude.. all of these guys and analysts saying the H&S pattern failed are "Wrong"...It was only interrupted by an Earnings Season Jump!! It's still Intact only delayed due to over exuberance and Idiots thinking they missed the train!! The Correction is back on track, the hype is over and now what was delayed a month will now be able to run its course!! OK...I'm done.
so you are saying that now we have 'head', 'shoulder' then next thing will be 'stomack' then 'legs'.
WOW .. this is incredible, we will have perfect 'man' and that will be ... Who?
Great work man ... good job
Isn't it possible that we just completed the left shoulder and now are working on the head of a head and shoulders pattern? Look at the volume trends and check out the pattern on the daily chart on stockcharts.com.
I'm looking at the DOW Indu.
Also, be mindful of the dollar. Any small movement upward could mean bigger drops in the stock market.
Also, anyone besides me tired of listening to Al Cashin on CNBC? Gawd, what flip flopper.
Also, you look at the weekly chart, and it appers we just finished the left shoulder and now working on the head. Since the weekly trend is stronger than the daily, perhaps attention should be given there.
agreed we are coming off of 2 military exercises, but i would not compare them to WWII.
also, there is more money going into the markets coming off of the sidelines than ever before.
there is your differences.
1. manipulation is at its all time high.
2. sidelines money pouring back in.
3. sign of capitulation. lots of folks figured after march 9th the worst was over. more folks are jumping in that have never done so before to get a piece of the market that they know nothing about since it has been beaten up back to 1990's levels. a lot of good stocks can be bought cheap and they want their piece of it.
4. greed. lots of folks are jumping in that thought they missed the first rally eventhough they don't realize this market has once again been over manipulated and over pumped.
all of this adds up to the bear market rally we are seeing, which is different than 1948.
these are my observations.
sideline money is not pouring back in, i know people with ALOT of sideline money and they are still waiting...if sideline money was out for s&p to go from 600 to 900, why would they jump in now at 979, they are not, and anyone that is getting back in now after that run deserves to lose money for thinking NOW is a good time to buy...
nice find.. I hope you're right. There's also the risk of the march lows being the head on an inverted H+S pattern if you look across a 1yr span. Unfortuntely hindsight will be 20/20.. lets just hope that it will be in the favor of the bears
There's always someone saying buy at the top. Cramer did at NASDAQ 5000 and DOW 13700.
I looked at the Fast Stochastics of the Russel 1000 financials and it was shocking how over bought it is and how it is running into massive resistance. The biggest indicator of a top for me is the lower volume on GS as it has gone higher past few months. GS volume is drying up indicates they are ready to increase volume by sending the market in the other direction. They make money on volume and hedge their trades, just like a casino. I'd bet my life the market reverses next week and FAZ will be a great place to enhjoy the ride down...banks get downgraded after earnings. Earl
good research jersis....
made a post earlier in the week, http://messages.finance.yahoo.com/Stocks_%28A_to_Z%29/Stocks_D/threadview?m=tm&bn=87812&tid=379748&mid=379786&tof=37&frt=2
i have to agree. i trade on technical analysis too. yes, this looks like the same 1948 pattern, however we need to remember in history where we were at, and was there as much sideline money going into the market then like it is now? we have a lot of sideline money coming into the market. we should take a moment and do that comparison in today's dollars as if it were 1948, so you get a fair comparison.
also, in 1948 the USA was just coming off WWII. America was the strongest country on the planet. We were the largest manufacturer of goods. this will have a different effect on the outcome of this pattern. the USA is not as strong as it was then - relatively speaking.
the USA is coming out of the back side of a hurricane and the water is going to be choppy and flat for several years to come. this market will trade flat for a while.
now, after all the pumping and massaging of the earnings reports, there won't be much great news after that. and, since we are not coming out of a World War this market could have a major correction.
i'm still sticking to FAZ going back to test 50 again in 7 business days after the pumping party is done.
only thing that concerns me is how much real sidelines money is going in and much is left?