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Thread: P&F Chart School

  1. #13

    Default Re: P&F Chart School

    Hey James,
    Just curious - see link belowe for the EAFE p&F chart - three red "Os" added, but no Support break, no red "Bearish Resistance Line" today, or even close (that I can tell)...
    http://stockcharts.com/h-sc/ui?s=efa...d=p55192775979

    (click on p&F at the bottom)

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  3. #14

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    Default Re: P&F Chart School

    No bearish resistance line because the bullish support line (blue) is so far down below. The falling dollar has a lot to do with how far up the EFA has come since 2002.

    It is possible that there could be a LOT of O's straight down before it ever made it to a red line appearing. However, that still means we have some opportunities to jump in on upticks, where I would NOT do the same right now with the S&P.

    Later-

    J

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  5. #15

    Default Re: P&F Chart School

    Quote Originally Posted by James48843 View Post
    No bearish resistance line because the bullish support line (blue) is so far down below. The falling dollar has a lot to do with how far up the EFA has come since 2002.

    It is possible that there could be a LOT of O's straight down before it ever made it to a red line appearing. However, that still means we have some opportunities to jump in on upticks, where I would NOT do the same right now with the S&P. Later -J
    Thanks James,
    Hmmmmm, think its wait and see. I assume, as usual, OSMs will follow USMs, so tomorrow OSMs will likely be terrible! However,... if tomorrow we get a DCB - then Thurs & Fri could be good days for OSMs, maybe even Monday. Still, likely any possible gains, are outweighed by the risks. OSMs could remain in trepidation - but it is intriguing.
    VR

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  7. #16

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    Default Re: P&F Chart School

    Yep.

    Japan opens lower tonight, going down big time. Now showing the Nikkei as being down 5.52 (-1.87%)as of 11:00 pm.

    The thing to look for, by the way, on that big string of "O's" is a three box X reversal. If it doesn't make it three boxes up, then it's not a buy signal. You have to have three boxes of movement for the price reversal to show up as X's rather than simply higher O's in the same column.

    But again, with this kind of up and down movement- it's really more like knife catching than a true bottom and reversal signal.

    Catching a knife can cause very, very bloody fingers.

    Be careful out there, ya hear?

    Last edited by James48843; 11-19-2007 at 11:21 PM.

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  9. #17

    Default Re: P&F Chart School

    Not trying to be arguementative - just inquisitive. Please don't take offense:
    In order for three or moe boxes to show up we'd have to see a darn good uptrend - at least a full 2 to 3 point, maybe 4 increase of 79 to 81 to 83.0 price (that's a bout a 3% to 5% increase). Seems that this misseses the rize I'd hope to catch (short term - out Fri.) On other hand, if we don't see any more red Os, or those that appeared today (as are red) disapper, leaving less than previous (or numbers adjust), this could mean go for it (by noon).

    It just that it seems that on this chart, the Blue line so far away, the USMs would have to fall really far for the OSMs to reach that Blue Support . If there's a DCB and USM go up - just seems to me why wait?

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  11. #18

    Default Re: P&F Chart School

    Hi James,
    I feel confident that your heart is true - always desiring to give folks best advice possible (and as a result sometimes feel conflict in wanting to protect folks like me, and maybe folks new to the "sport). I know that I'f fell this way if roles were reversed, as I have experieced the same thing in other aspects of my life. Anyway, up front I wanted to say thank you sincerely for those concerns. Also that you should feel good in having given the best advice and of yourself - in giving of your heart and soul, in your responses. Having done all that, never feel responsible for actions that others may take.

    Looking forward to getting back to Class discussions.


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  13. #19

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    Default Re: P&F Chart School

    Quote Originally Posted by hessian View Post
    In order for three or moe boxes to show up we'd have to see a darn good uptrend - at least a full 2 to 3 point, maybe 4 increase of 79 to 81 to 83.0 price (that's a bout a 3% to 5% increase).
    No offesne taken in the least. One thing to remember here is that you will not get any X's, until it rises enough to make three or more X's above the bottom. Under the P&F chart way to doing it, you will only get movement within the O column, UNTIL you have enough movement to make three X's. Now an "X" can reflect a portion of a dollar, or a full dollar, or ten dollars, etc. When, for example, the price of a stock is five bucks a share, the X's represent .10 cents at a shot. The size of what the box represents is directly porportional to the altitude at which the price is.




    Seems that this misseses the rize I'd hope to catch (short term - out Fri.) On other hand, if we don't see any more red Os, or those that appeared today (as are red) disapper, leaving less than previous (or numbers adjust), this could mean go for it (by noon).
    By all means, you are free to make what ever decisions you would like with your own account- it's YOUR money, and you decide what is best for you.

    I guess I better clarify here- the purpose of this thread is to learn more about this one theory of charting- P&F charts. Whether YOU decide to follow that theory is totally up to you. I am going to follow it for a while, because I have found it useful. I am NOT necessarily using it relating to the "I" fund, because the "I" fund has other varibles thrown in which I am not sure yet really reflect the same amount of usefulness. Specifically, the change in the value of the dollar does have an affect on the results shown on the chart. So you won't break through that blue line until either the dollar reverses direction significantly, OR the values of overseas stocks tumble, or a combination of both. On the other hand, the use of the P&F chart for following "C" or "S" is different, and had more relevant "visuals" for me.



    It just that it seems that on this chart, the Blue line so far away, the USMs would have to fall really far for the OSMs to reach that Blue Support . If there's a DCB and USM go up - just seems to me why wait?
    You may want to go ahead and dive in- that's your call and that is fine with me. I am just trying to explain the P&F chart theory, so that IF you choose to lend any weight to it in your own decision making, you can have one more tool in your list of tools to use to help you decide, that's all.


    What the P&F chart is doing for me right now is allowing me to see very clearly the intermediate term trend. Down. Rather than focus on the day-to-day ups and downs.

    Part of me wants to jump back in and try and catch the wave. Another part of me says that the P&F chart history is more inclined to result in lower, not higher, prices a week or two from now, and it may be better to wait until things settle down before wading back in.

    So I am going to wait a bit more, until I see some other indicators, before deciding what to do. P&F chart is one thing I take into account. The odds of an interest rate cut on Dec 11th is another thing I will take into account. Price of oil nearing $100 a barrel again is another thing to take into account. More sub-prime fiasco news is another thing to take into account. The change today in forecasted GDP growth next year, and higher unemployment next year is another thing I am going to take into account. Targetr same-store sales being down is another thing I am going to take into account. etc, etc, etc, all have an influence in the ultimate decision - which is ....where will my money perform the best for me in the days and weeks ahead.

    Right now- not sure. So am sitting on the sidelines.

    that's it. No big deal, just another datapoint to consider.

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  15. #20

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    Default Re: P&F Chart School

    ON your EFA chart- today's higher close means three X's stay in place, above the blue support line. Typically indicitive of a "Buy" signal under P&F chart theroy. If you choose to follow it- you probably will be right. More power to you.

    I, however, am going to sit a while and think, however.

    http://stockcharts.com/def/servlet/S...=EFA,P&listNum=

    Take a look at that EFA P&F Chart, back in the 2002-2003 period, bottom left hand side. The last time we had seven O's, followed by three X's up, it then reversed and within a short time when down two more times.

    the column I am looking at from 2002 lookes like this:

    6
    0
    0
    7
    0 X
    0 X
    0 X
    0


    That COULD be where we are today- at the three X's up part in the first part of that cycle. The it tanks down later on, a lot further down.


    Not sure, really. Only time will tell.

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  17. #21

    Default Re: P&F Chart School

    James:

    Thank you for this very clear explanation of this chart. I have been trying to read it through the various web sites, and not having much luck understanding it. Seeing you explain the chart as the market changes makes things a lot easier to understand.

    I do have some questions on the current P&F charts of the following:

    $INDU: "Descending triple bottom breakdown on Nov 20 2007" "Bearish price obj (rev??) met (12900)"
    $NDX: "Bearish triangle breakdown on 20-Nov-2007"
    "Bearish price obj (REV??) 1750"
    $SPX:"Descending triple bottom breakdown on 20-Nov-2007" Bearish price obj (Rev.) 1350"

    Can you explain what those mean in terms of the market? Also, I am guessing that Rev. means "reversed", but what does that mean exactly, again with respect to the market?

    Thanks very much.

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  19. #22

    Default Re: P&F Chart School

    James, thanks for teaching about P&F charts. It's really helped.

    I have a question -- what do the numbers/letters within the columns mean.

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  21. #23

    Default Re: P&F Chart School

    Quote Originally Posted by Sunnyskies View Post
    James, thanks for teaching about P&F charts. It's really helped.

    I have a question -- what do the numbers/letters within the columns mean.
    That one, I do know. 1 through C are the months of the year, 1=Jan, 2=Feb, etc... Since P&F charts are independent of dates, the date notations show when that part of the chart got started...

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  23. #24

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    Default Re: P&F Chart School

    Quote Originally Posted by RPM View Post
    That one, I do know. 1 through C are the months of the year, 1=Jan, 2=Feb, etc... Since P&F charts are independent of dates, the date notations show when that part of the chart got started...

    Correct-

    1=Jan
    2=Feb
    3=Mar
    4=Apr
    5=May
    6=Jun
    7=Jul
    8=Aug
    9=Sep
    A=Oct
    B=Nov
    C=Dec

    The number or letter is where ever the price was on the LAST trading day of that month.

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