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JTH

Chart Patterns: Complex Head & Shoulders

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by
JTH
, 06-23-2011 at 09:03 PM (2725 Views)
Disclosure: The Chart Pattern blogs are exercises not meant to be traded off of within the TSP system of rules. I myself don't trade chart patterns within the the major indexes on the daily timeframe and I don't recommend you do either. The lack of flexibility in acquiring the right entry & exit make these patterns difficult to trade. Add to this the fact the major indexes are watched by everyone and often times when everyone is watching the same chart pattern, it does not come into fruition.

This pattern is NOT a Complex Head & Shoulders formation, but it could become one. Here we have an inner H&S within a larger H&S. Be forewarned that forecasting patterns is like the Weatherman telling you when a tropical storm is going to become a hurricane and where it's going to land. Sometimes it happens, but most of the time it doesn't. As you can see, this pattern appears to be making an attempt to form the Right Shoulder. Based on current levels I've forecast a price objective of 1315-1330. Within the larger H&S, if the Right Shoulder were to form, then come back down and break through the neckline at 1265, then the Price Objective would be 1165.
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Chart Patterns

Comments

  1. FireWeatherMet's Avatar
    Battle on Debt Ceiling looming...fear of US default for 1st time ever.


    Certainty that a certain political party (to remain nameless) will take it right down to the Aug 2nd deadline.

    http://www.nytimes.com/2011/06/24/us.../24fiscal.html

    This one is easy.
    Aug 2nd is a long way away to be with lingering bad news.

    Bet on 1165.
  2. JTH's Avatar
    I'd bet on 1315 before 1165, too many "ifs" involved in both scenarios to place a bet.
  3. EmoDx's Avatar
    Quote Originally Posted by FireWeatherMet
    Battle on Debt Ceiling looming...fear of US default for 1st time ever.


    Certainty that a certain political party (to remain nameless) will take it right down to the Aug 2nd deadline.

    http://www.nytimes.com/2011/06/24/us.../24fiscal.html

    This one is easy.
    Aug 2nd is a long way away to be with lingering bad news.

    Bet on 1165.
    I totally disagree with you. We will face shut downs before defaulting on anything.

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