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Joined: 1/22/2006
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When does the H&S pattern for S&P and the DOW Fail?
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Joined: 2/5/2006
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QUOTE (aspiteri) When does the H&S pattern for S&P and the DOW Fail?
when price rises above the right shoulder.
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Joined: 12/19/2004
Posts: 415
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Timber, Timber
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Joined: 1/27/2005
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There have been numerous comments about a Head & Shoulders pattern, also a bigger potential Inverse Head & Shoulders pattern.
Nowhere do I see any comments about the volume pattern that accompanies either formation.
Contracting and expanding volume can be critical in identifying a good pattern.
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Joined: 2/5/2006
Posts: 1,148
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QUOTE (mistermax) There have been numerous comments about a Head & Shoulders pattern, also a bigger potential Inverse Head & Shoulders pattern.
Nowhere do I see any comments about the volume pattern that accompanies either formation.
Contracting and expanding volume can be critical in identifying a good pattern.
check about the fourth post down.
http://forums.worden.com/Default.aspx?g=posts&t=40739
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Joined: 1/28/2005
Posts: 6,049
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Also check the picture.
Thanks
diceman
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Joined: 7/1/2008
Posts: 889
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Goodbye Head & Shoulders.
Hello bullish flag breakout.
Seems there's a new game in town.
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Joined: 2/5/2006
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QUOTE (ben2k9) Goodbye Head & Shoulders.
Hello bullish flag breakout.
Seems there's a new game in town.
not quite, still plenty of resistance above, and the possibilty of another right shoulder being formed.
not really sure what all the excitement was about. intel is great at stuffing channels, and cooking books. seems a big component was due to china's stimiulus program. all things considered intel still lost money for the quarter.
but, it is amazing how patterns can morph.
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Joined: 7/1/2008
Posts: 889
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yes but the H&S pattern is now weakened, and the flag is in play.
Intel + empire manufacturing were upside surprises.
it is what it is!
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Joined: 12/31/2005
Posts: 266
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QUOTE (ben2k9) yes but the H&S pattern is now weakened, and the flag is in play.
Intel + empire manufacturing were upside surprises.
it is what it is!
The mother of all short squeezes.
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Joined: 1/30/2009
Posts: 267
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QUOTE (ben2k9) Goodbye Head & Shoulders.
Hello bullish flag breakout.
Seems there's a new game in town.
I have a question regarding this rally. I have noticed on my charts as well as Ben's charts that the average volumes have dropped steadily about 40% since the March lows. I use a 21 MA for my volume graph and it looks like Ben uses a 50 MA but shows on both time frames. I see it on the Dow, S&P, and NYSE. The Nasdaq volume has held steady. Now, my question for you experienced traders is, can the rally continue for much longer in declining volumes? I just can't see it continuing much longer but maybe I am missing something.
Thanks,
Hiromj
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Joined: 12/19/2004
Posts: 415
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Well I thought back in March that the SPX would climb to ~1000. The targets haven't changed that much 940-1020. Too many people are/were bearish and want to hang onto anything that points to lower prices. Too many people talking about a head and shoulders pattern and THEN failed H&S made me suspicious.
The volume is key, falling volume in a long rally portends limited upside potential, not a new bull market.
After this move then a retest of the March lows (perhaps even lower lows), IMHO.
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Joined: 1/27/2005
Posts: 6
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QUOTE (funnymony) QUOTE (mistermax) There have been numerous comments about a Head & Shoulders pattern, also a bigger potential Inverse Head & Shoulders pattern.
Nowhere do I see any comments about the volume pattern that accompanies either formation.
Contracting and expanding volume can be critical in identifying a good pattern.
check about the fourth post down.
http://forums.worden.com/Default.aspx?g=posts&t=40739
Good call on your part. I was thinking more about the daily market summary which most people read
and to my recollection, volume has never been mentioned at all.
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Joined: 2/5/2006
Posts: 1,148
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QUOTE (mistermax) QUOTE (funnymony) QUOTE (mistermax) There have been numerous comments about a Head & Shoulders pattern, also a bigger potential Inverse Head & Shoulders pattern.
Nowhere do I see any comments about the volume pattern that accompanies either formation.
Contracting and expanding volume can be critical in identifying a good pattern.
check about the fourth post down.
http://forums.worden.com/Default.aspx?g=posts&t=40739
Good call on your part. I was thinking more about the daily market summary which most people read
and to my recollection, volume has never been mentioned at all.
true, never heard anything about the patterns volume profile from the "so called" experts. now they'll say technical analysis failed.
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Registered User
Joined: 12/2/2004
Posts: 1,775
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Ideally in a H&S I've always been under the assumption that you want to see volume increase on the pullbacks...not that important in the left shoulder, but more so in the head and right shoulder, and finally an even greater volume increase when neckline fails. IBD's William O'Neil is very adamant on the importance of the right shoulder being lower than the left shoulder even if slightly so. FWIW.
I think stock LEAP is a good example. Note volume increase in pullback of head area late May & early June, and the breakdown of right shoulder and neckline early July. Nice little bear flag it's formed.
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Joined: 7/1/2008
Posts: 889
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damn, LEAP does look like a good short!
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Joined: 7/1/2008
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QUOTE (ben2k9) Goodbye Head & Shoulders.
Hello bullish flag breakout.
Seems there's a new game in town.
Thank you, technical analysis!
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Registered User
Joined: 2/5/2006
Posts: 1,148
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have to admit things moved a little to fast for me to make an entry, but at least i didn't get caught short.
one h & s with a poor volume pattern just failed, now we'll see if the large inverse h & s doesn't fail as well.
top of megaphone pattern reached today.
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Joined: 7/1/2008
Posts: 889
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What I am looking for is the recent broken resistence zone of around 950 now become support. I'd like to see the market push higher one or two more days, then correct back down to 950 and find support.
If it holds there I'll be backing up the friggin truck and getting longer on margin.
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