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Hi BT,
You are absolutely correct when you say "<FONT
face="Times New Roman" size=3>All good Head and Shoulders are
tradable". This is especially true if you understand and use
options. A prudent investor would hedge positions in such a situation, or
use options to establish positions that are profitable regardless of the
direction of the next move.
I recently read an article that defined speculators
as anyone who does not hedge their positions. This includes everyone who
uses "buy and hold".
Good luck and good trading,
Ray Raffurty
<SPAN
style="FONT-SIZE: 24pt; COLOR: #006600; mso-bidi-font-size: 12.0pt">
<SPAN
style="FONT-SIZE: 24pt; COLOR: #006600; mso-bidi-font-size: 12.0pt">TTI
NATIONAL, Inc.<?xml:namespace prefix = o ns =
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/>
<SPAN
style="FONT-WEIGHT: normal; FONT-SIZE: 10pt; COLOR: #006600; FONT-STYLE: normal; mso-bidi-font-size: 12.0pt"><FONT
size=4>4.25 CENTS PER MIN. FOR YOUR
BUSINESS
<SPAN
style="FONT-WEIGHT: normal; FONT-SIZE: 10pt; COLOR: #006600; FONT-STYLE: normal; mso-bidi-font-size: 12.0pt"><FONT
size=4>LONG DISTANCE AND TOLL FREE SERVICE
<SPAN
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size=4><SPAN
style="FONT-WEIGHT: normal; FONT-SIZE: 8pt; COLOR: #006600; mso-bidi-font-size: 12.0pt">GREAT
IN-STATE RATES TOO<SPAN
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size=3><SPAN
style="FONT-WEIGHT: normal; FONT-SIZE: 10pt; COLOR: #006600; FONT-STYLE: normal; mso-bidi-font-size: 12.0pt">FOR
MORE INFORMATION CALL<SPAN
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<SPAN
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size=6>866-456-9537
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<BLOCKQUOTE
style="PADDING-RIGHT: 0px; PADDING-LEFT: 5px; MARGIN-LEFT: 5px; BORDER-LEFT: #000000 2px solid; MARGIN-RIGHT: 0px">
----- Original Message -----
<DIV
style="BACKGROUND: #e4e4e4; FONT: 10pt arial; font-color: black">From:
BT
To: <A title=realtraders@xxxxxxxxxxxxxxx
href="mailto:realtraders@xxxxxxxxxxxxxxx";>realtraders@xxxxxxxxxxxxxxx
Sent: Tuesday, July 16, 2002 7:25
PM
Subject: Re: [RT] John Murphy notes: the
market isn't "cheap"
A pattern will follow through or it will fail pattern ,which
is as good , better in most cases. As one side is trapped and "out at any
price" is the best opportunity .
The Head and Shoulders price pattern is a lot more than just a
price pattern, it is also a volume pattern , which is more important
.
Volume is the key in all these price patterns. It is what tells
the story.
Like the sub titles in a movie. Without volume there is no
sentiment. No place to tell where the orders are .
Which was the other Fed study .. The more important study one ,
they did .
So,
All good Head and Shoulders are tradable , not all Head and
Shoulders are good .
It is the hidden and the hard ,that make them good or
not.
Mr. Murphy makes this point very well in his
books for the careful reader.
<BLOCKQUOTE
style="PADDING-RIGHT: 0px; PADDING-LEFT: 5px; MARGIN-LEFT: 5px; BORDER-LEFT: #000000 2px solid; MARGIN-RIGHT: 0px">
----- Original Message -----
<DIV
style="BACKGROUND: #e4e4e4; FONT: 10pt arial; font-color: black">From:
M.
Simms
To: <A
title=realtraders@xxxxxxxxxxxxxxx
href="mailto:realtraders@xxxxxxxxxxxxxxx";>realtraders@xxxxxxxxxxxxxxx
Sent: Tuesday, July 16, 2002 3:52
PM
Subject: RE: [RT] John Murphy notes:
the market isn't "cheap"
See post regarding the 93% success rate.........I
don't believe it...Bulkowski can't code....thus he probably can't
specify.....thus thetechnique is probably unreliable.>
-----Original Message-----> From: Daniel Goncharoff
[mailto:thegonch@xxxxxxxxxx]> Sent: Tuesday, July 16, 2002 10:32
AM> To: <A
href="mailto:realtraders@xxxxxxxxxxxxxxx";>realtraders@xxxxxxxxxxxxxxx>
Subject: Re: [RT] John Murphy notes: the market isn't
"cheap">>> Why would you be 'heavily' short? Wouldn't
you want to take a short> position in anticipation of the move, but
not a big one, since we agree> that it is often inconclusive, and at
times produces a reversal?>> Regards>
DanG>> "M. Simms" wrote:> >> > If that's
the case, then you should be heavily short....> > on anticipation
of the neckline "break".> >> > > -----Original
Message-----> > > From: Adrian Pitt
[mailto:apitt@xxxxxxxxxxxxx]> > > Sent: Tuesday, July 16, 2002
5:37 AM> > > To: realtraders@xxxxxxxxxxxxxxx> > >
Subject: RE: [RT] John Murphy notes: the market isn't "cheap"> >
>> > >> > > You mean I can trade a Head and
Shoulder top for a small risk> and make a> > > great
gain on many occasions, 50% of the time? Your right...sounds> >
> pretty ordinary...i want something that works 90% and makes>
10/1 reward> > > to risk.. :-)> > >>
> > Adrian> > >> > > > -----Original
Message-----> > > > From: M. Simms
[mailto:prosys@xxxxxxxxxxxxxxxx]> > > > Sent: Tuesday, 16
July 2002 7:10 AM> > > > To:
realtraders@xxxxxxxxxxxxxxx> > > > Subject: RE: [RT] John
Murphy notes: the market isn't "cheap"> > > >> >
> >> > > > WARNING, WARNING....John is getting pretty
old and so are his> > > > techniques.....> > >
>> > > > backtesting Head and Shoulders patterns shows no
better than> > > > a 50% prediction of significant,
tradeable bottom or top.> > > > Many fantastic "reversal"
rallies have emanated from the> neckline....> > >
>> > > > GOTTA DO YOUR HOMEWORK, John....and less
appearances !> > > > > -----Original Message----->
> > > > From: Gary Funck [mailto:gary@xxxxxxxxxxxx]> >
> > > Sent: Sunday, July 14, 2002 8:02 PM> > > >
> To: Realtraders@xxxxxxxxxxxx Com> > > > > Subject:
[RT] John Murphy notes: the market isn't "cheap"> > > >
>> > > > >> > > > >> >
> > >> > > > > <A
href="http://www.murphymorris.com/affiliate/market_watch.html";>http://www.murphymorris.com/affiliate/market_watch.html>
> > > >> > > > > John Murphy's Market
Watch> > > > >> > > > > by Mr. John
Murphy, President of MURPHYMORRIS.COM> > > > >>
> > > > Sat, July 13, 2002 - HEAD AND SHOULDERS TOP?>
> > > > WHAT IS IT?... Quoting from the Glossary in my
book> > > > Technical Analysis> > > > >
of the Financial Markets: "A head and shoulders top is the> > >
> best known> > > > > of the reversal> >
> > > patterns. At a market top, three prominent peaks are formed
with> > > > > the middle> > > > > peak
(or head) slightly higher than the other two peaks> > > >
> (shoulders). When the> > > > > trendline (neckline)
connecting the two intervening troughs> > > > is broken,
the> > > > > pattern is complete." While most major
averages show a similar> > > > > pattern, we're>
> > > > using the NYSE Composite Index for illustration purposes
because> > > > > we believe it> > > >
> probably gives the best overall measure of the state of the>
> > > > "market". There's> > > > > no
question that the chart has the look of a "head and shoulders"> >
> > > top. The two> > > > > "shoulders" were
formed during 1998 and 2002. The "head" formed> > > > >
during 2000.> > > > > The "neckline" is drawn under the
1998-2001 reaction lows.> > > > As of Friday's> >
> > > close, the neckline is already been pierced on the downside,
but> > > > > not by much.> > > > >
There are two other support levels that bear watching. The> > >
> first is the> > > > > intra-day low hit last fall
(which is at 494). The second (and> > > > > more
important)> > > > > is the late 1998 low at 463. Friday's
close was only a> > > > shade below last> > >
> > September's low, but not by enough to call this a clear
breakdown> > > > > -- at least> > > >
> not yet. Regarding the breaking of the "neckline", there's also
a> > > > > 3% rule which> > > > >
comes into play at major chart points. That means that the> > >
> > neckline needs to be> > > > > broken by at
least 3% before we can call it a "major" breakdown.> > > >
> We may get> > > > > there (about 485), but we're not
there yet. Unless the market> > > > > attempts a
rally> > > > > soon, however, a breakdown could be
imminent, which could> > > > carry the market> >
> > > lower into the September/October period.> > >
> > [...]> > > > > THE MARKET ISN'T CHEAP... The
purpose of looking at the long-term> > > > > charts
isn't> > > > > to scare anyone. Our main goal is to show
that this market> > > > isn't cheap. In> > >
> > fact, it's still historically very high. We've expressed the
view> > > > > several times> > > > >
before that we believe the twenty-year bull cycle has ended. That>
> > > > means the> > > > > current bear
market could last longer -- and fall much further --> > > >
> than most> > > > > people realize. We don't know how
low it can go. It's the> > > > direction that> >
> > > matters most -- not the actual numbers. The "head and
shoulders"> > > > > tops shown in> > > >
> the preceding charts is another warning that things could> >
> > still get a lot> > > > > worse. As the message
is finally getting across to the public> > > > > that
this bear> > > > > market is indeed different from those
in the recent past,> > > > mutual fund> > >
> > redemptions are starting. Imagine what could happen when
the> > > > > public finally> > > > >
decides to start selling.> > > > >> > > >
>> > > > >> > > > >> >
> > > To unsubscribe from this group, send an email to:>
> > > > realtraders-unsubscribe@xxxxxxxxxxxxxxx> >
> > >> > > > >> > > >
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to> > > > > <A
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>> > > >> > > >> > >
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