Monthly Archives: November 2011

S&P 500 Working on a Potential Inverse Head and Shoulders Formation

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. Share

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Price Action Lab Alert: Eight Consecutive Lower Closes In SPY is not a Significant Sample

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

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ETF Trends – Week of November 28, 2011

As of the close of Friday, November 25, 2011, there are only 3 changes in the ETF trend state table from the week before. As expected, the short-term trends that emerged were maintained and the changes regard only the medium and … Continue reading

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Dow 4,000? What Technical Analysis Says or Doesn’t Say About Such Possibility

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

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The Many Faces of Trading Expectancy

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

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Does It Look Like June of 2008 All Over Again? Not Yet.

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

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Stock Market: A Short-term Reversal to the Upside is Highly Probable

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. Share

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ETF Technical Analysis as of Friday, November 18, 2011

As of the close of Friday, November 18, 2001, there are more failures of traditional chart patterns and downside breaks of rising channels. In SPY we have a failed symmetrical triangle, in GLD and SLV downside breaks of rising channels and in USO … Continue reading

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