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Hello,
Thank you so much for your postings. They are quite inciteful and as a trader myself, I understand.
One thing about the H&S formation. I always thought that in order to tell the difference between a H&S and a double/triple top the 1) left shoulder had to resemble more of a conjestion period, approximately half the amplitude of the head; and 2) the right shoulder had to be sloping downwards - a weak shoulder in order to fill the bill for a reversal pattern.
H&S can be a continuation or a reversal pattern depending on the "performance" of the shoulders.
I like your chart. Perhaps a triple top?? Hey, if it was a good sell at 16.70 then it's a great sell at 17.20 !!**??
<welcome to my parlour said the spider to the fly>>
Kindest regards
Denise
At 01:00 PM 7/10/97 +0200, Gaetano A. Evangelista wrote: >>>> For those (a few, I believe) interested in cross rate US Dollar / Italian Lira, here is an interesting chart. I put it on Realtraders because I believe here we deal with technical analysis, and this chart is a perfect example of how to interpret technical tools properly, i.e., wait the signal before pass the order to your broker... Since the spike top in march 1995, usd/itl was in a well-defined downtrend, accompanied by its (triangular) moving average, which worked well even in the past. Then at the end of last year, USD/DM broke the 12-year channel at 66 and moved upside on the italian lira (well confirmed by the action of the moving average). The movement lasted until the beginning of march, when a head and shoulders appeared to form. Edwards-Magee more and more times underlined how a pattern give its signal only when it's definitively broken, and in fact, after two test of the moving average (and having touched the trendline), dollar is giving some regrets to the italian bears, who are running to close their short position. If a recall correctly, Elder once says "when an apparent h&s is followed by price action overcoming its right shoulder, a potential bearish signal becomes a strong bullish signal"... So here is the lesson: "do not anticipate a signal, and follow the trend!"
ciao
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%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%% Gaetano Arnaldo Evangelista - BARI (Italy) E-mail: ageitaly@xxxxxx URL: http://www.geocities.com/wallstreet/8492 %%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%% <<
Denise Beebe Throntveit President FOREMOST FUTURES. LTD. 223 West Jackson Suite 600 Chicago, IL 60606 800-227-0335 EMail: foremost@xxxxxxxxxxxx
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