Monthly Archives: November 2011
A potential inverse head and shoulders chart pattern is currently under formation in S&P 500 after yesterday’s price action. If this pattern finally forms it will signal another rally, possibly to a 4-year high, but a few important obstacles must be cleared first.
Several analysts over the weekend made reference to the price pattern of 8 consecutive lower closes formed in SPY and based on that they are betting on a short-term recovery. Historically, the pattern has occurred only 5 times since this ETF started … Continue reading
Recently I read an analysis about the possibility of Dow dropping to 4,000 or even as low as 1,000. The claim was that technical analysis of long-term charts supports such a possibility. I argue here that it is not pure technical analysis that … Continue reading
Some authors define trading profitability using the expected value or expectation, a.k.a expectancy. However, it would only suffice for them to say that a trading system, trading method, or even investment program, is profitable if the net profit/loss is positive, i.e. if it … Continue reading
In many blogs and investment sites there is a talk about the stunning resemblance of the price action in S&P 500 index back in May-June of 2008 and just before the market collapse that followed, to the current price action pattern. I argue here … Continue reading
As of the close of Monday, November 21, 2011, price action patterns and directional probability calculations point to a reversal to the upside. It is not clear at this point whether a bottom is being formed at these levels.