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Yuki,
could you please take a look at
http://www.chartpatterns.com/headandshoulderscharts_.htm
and tell me which example matches better to your H&S point of view?
We could add some additional Volume conditions to the existing H&S
code.
1. Do you want the Volume to form a H&S too [like JYC example],
diminishing [like the BPC example] or something else ?
2. Does your picture agree with the volume expansion at the breakout
[although it is too late for any action...]
3. Should we ask the 3 peaks to be a% higher than the recent [last 3-
6 months] lows
4. Any MAs condition as long as the H&S is created
TIA
Dimitris Tsokakis
--- In amibroker@xxxxxxxxxxxxxxx, Yuki Taga <yukitaga@xxxx> wrote:
> Hi Dimitris,
>
> Tuesday, November 18, 2003, 9:32:14 PM, you wrote:
>
> DT> Let us see the recent ^NDX behavior.
>
> DT> After a long period we have had [Nov9 to Nov10] the first
> DT> important bearish signals, a simultaneous
>
> DT> ~MeanStochD and ~MeanRelSlope divergence. The whole market
> DT> looks a bit tired and the bears have
>
> DT> a lot of reasons to wake up
>
> DT> P2 [Nov7] is the second peak of a probable H S
> DT> formation.[sensitivity perc=3%]
>
> DT> The trendlines are no longer parallel, a slight converging
> DT> wedge is apparent day by day.
>
> DT> If the next days will keep on creating the H S, let us see
> DT> the proper action moment.
>
> DT> It is easy [and confusing] to speak after the
> DT> facts .
>
> DT> We have more than 5 bars to see any complete form, let us
> DT> concentrate in the details [other leading/lagging] indicators]
>
> DT> and add contributions to this thread, but, please, before the
> DT> facts.
>
> DT> 15 bars later we may see what was written and make
> DT> our comments [or laugh with our great texts !!]
>
> DT> I hope it is interesting.
>
> There is NO question that this market looks very tired. MRSI and
RSI
> divergences since September are telling. These divergences persist.
>
> However, classic H&S is not indicated at all, to me. The volume
> signals necessary to validate or suggest such a position just are
not
> there . . . unless we use our imagination and get very creative,
> which is a violation of TA formation-spotting in my book. But
> really, they are just not there, and I don't see it.
>
> The plain fact of the matter, though, is that markets do NOT hold
> continuously at ~20 percent above their 200 day SMAs. And that is
> roughly where this market has been churning higher for several
months
> now. In a strong trend of course, that CAN persist for a while.
But
> it is bound to come undone, and the downside risks here are not
> insubstantial -- the longer this unsustainable posture persists, the
> sooner it has to come undone. This is an index where even the
rather
> responsive 18 day SMA has NOT ONCE even dipped below the 50 day SMA
> since they last crossed in March. It's an index that is up a
> startling 40 percent since March. The only reason in my opinion it
> has been able to come this far, is that such a percentage is still
> within some acceptable (and even normal) oscillation coming off the
> absurd bubble created in the late 90s. But we are somewhat due for
a
> pullback of some magnitude I think.
>
> But I see nothing right now to indicate a major trend change, and
> certainly no H&S as I need to see them. But I see plenty to suggest
> that the risks of a major (and I think much-needed) correction are
> increasing. That correction could easily take the ^NDX as low as
> 1200. But that is only about a 16 percent pullback from the recent
> highs, and would still NOT indicate a reversal to a bear market.
>
> However, it could indicate the beginning of a broad sideways
> oscillation that swing and intermediate term traders might love,
> where the ^NDX roams up and down, covering 200 plus points at a
time.
>
> All that said, once again I see no signs of any complete trend
> reversal at all. But I see a one-way market for 7 months in what is
> more often a two-way world. This happens. It happens over and over
> again. But IT DOES NOT PERSIST over long time periods, and this one
> is getting long in the tooth, IMO. The low-hanging fruit is likely
> to have been plucked, and the road ahead may be more "interesting"
> that the road just traveled. I think many of these stocks will be
> available for decent long opportunities at better prices than we are
> now seeing.
>
> Yuki
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