DOW head and shoulders... Question...

Jarod

Jarod

Well-known member
Contributor
I don't know much about patterns in stock charts, but I have been learning a little...

Does the 1 year DOW chart appear to be a classic head and shoulders pattern? Is that a legit pattern to be applying to the DOW in general or does it only work with individual stocks? Is a one year chart where to look for the head and shoulders pattern or do you look at shorter time periods?
 
I am by no means an expert on charts but I do have some skills. Here is what I see.

3 month and 6 month look like classic head and shoulders.

1 year looks less clear to me

Daily looks like a double top which is itself bad.

A couple of things worry me about this run up. One is that it's breadth is really low meaning fewer and fewer companies are driving it up. Two is that volume is low. Three is that after the initial drop in Jan I would have expected a quicker rise.

I am still in cash and have open positions in SIL and GDX and FXC

topspin never wants to give me credit for the calls I get right ;)
 
Teflon Don said:
I am by no means an expert on charts but I do have some skills. Here is what I see.

3 month and 6 month look like classic head and shoulders.

1 year looks less clear to me

Daily looks like a double top which is itself bad.

A couple of things worry me about this run up. One is that it's breadth is really low meaning fewer and fewer companies are driving it up. Two is that volume is low. Three is that after the initial drop in Jan I would have expected a quicker rise.

I am still in cash and have open positions in SIL and GDX and FXC

topspin never wants to give me credit for the calls I get right ;)
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Am I wrong that you are generally bearish over the last 5 years or so?
 
Jarod said:
Am I wrong that you are generally bearish over the last 5 years or so?
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Yes. You are wrong. I was obviously bearish through 2009. Didn't go long until I was sure of uptrend.

Was bullish through 2011 and 2012. I was definitely bearish through 2013. Took a few short positions based on technicals. Got a couple right, but mostly wrong. However, I always let price be my guide. So I was long more than I was short. I just wasn't long the entire year. I was also in cash.

So for 2013, my S&P trades did not beat the market. But, I got lucky shorting gold so that made up for my other missed calls.

I have been pretty accurate this year though. My SIL and GDX trades have done very well. And that isn't after the fact bragging you can find posts from a few weeks ago calling it.

I think we are experiencing a relief bounce. The S&P cannot get back to 1850. That is the level it is going to have to break through for me to go long again
 
The Dude said:
He was bearish as fuck all last year!
The market was up 25 percent.
Not cool baiting him like that Jarod.
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I think I said that in my last post. There was no baiting at all.

You don't believe in technical analysis. That's cool. It has done pretty well for me. One year does not an investing career make
 
Jarod said:
Looks like today's numbers are answering my question about the DOW.
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Really today answered your question?

Notable today is that while the S&P spent some time above 1850 it failed to close above.

I am still looking for two closes above 1850 before I go long again.

You guys make the assumption that I hope for a decline. I neither hope for a decline or rise. I merely try to profit from both. I understand that it is scary for those who know little about technical analysis and it is easier to criticize that which you don't understand. Good luck
 
The Dude said:
Yet another big up day after our boy goes short. 9 for 10
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Why do you constantly lie about what I am doing?

I am not short now. I am in cash other than my long positions in SIL, GDX and FXC. I also have puts in FXI. they were up over 50% at one point but took it all back. Up 15% and 11% in GDX and SIL trades so far this year.

I was long up to 1850. Then went to cash. Took a short position at 1800 and followed it down. I stopped out at 1800.

As I said before I will need to see two closes above 1850 before I go long again.

Now had I been long the S&P this entire time it isn't even back to 1850. So what exactly do you think I missed out on?

I made a very low risk/ high reward trade which I will make every time. Now I had thought we had ceased hostilities but apparently you would rather be snarky.

Unlike you I am very transparent about my trades. You and Jarod only show up on up days as if you saw it all coming. Now I a up 13% YTD on all my trades so far even with the short position stopping out. If I were long the S&P for the year, I would barely be even. So I am thrilled because I am beating the market this year.

Maybe I will just put you back on ignore if you are going to be like Desh and do nothing but lie

BTW maybe you didn't realize this but I don't see this as a competition. Everyone has different investment strategies. You apparently think you have it all figured out and have nothing to learn. Good for you. I wish you well.
 
Oh and for the record the OP was asking about whether a head and shoulders pattern was forming. That you don't understand it isn't my issue, it is your fear bubbling up. That you don't acknowledge that using technical analysis such as support, resistance, moving averages and Fibonacci just highlights your own shortcomings like buying Apple at $700 and riding it do a 25% loss

I guess that is what all the billionaires do. Buy high and sell low?
 
You are soooo bad because you believe in a flawed method.
You need a certain amount of move to jump on the band wagon either way.
There is zero data supporting moves to continue.
Thus you jump in often near the end of the moves.
You have been the biggest correlation to an up move with your bad short calls last tho years.
Fact
 
The Dude said:
You are soooo bad because you believe in a flawed method.

There is nothing flawed about technical analysis. You act as if it is something that I made up. There are LOTS of investors who use technical analysis.

You need a certain amount of move to jump on the band wagon either way.

I look at support, resistance, moving averages and fibonacci levels. I never said it was 100% foolproof

There is zero data supporting moves to continue.

Not sure what you mean by this statement. Do you mean that there is zero evidence to show that technical analysis works? You would be wrong. Again, I never claimed that it was 100%

Thus you jump in often near the end of the moves.

You are flat wrong. In fact your posts PROVE you are wrong. I am not jumping in now am I? No. I am sitting in cash as I await the S&P to break through resistance. And if you want to talk about jumping in at the end of the move, how about buying Apple at $700 and riding it down like you did?

You have been the biggest correlation to an up move with your bad short calls last tho years.
Fact

It is interesting that you conveniently ignore those calls I get right, but only want to selectively focus on the ones that I do not. You will notice that I called GDX and SIL dead on. But you want to ignore that
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According to you, you claim to actively trade a number of stocks. If you aren't using technical analysis, what are you using to determine when to buy and sell? Are you just pulling it out of your ass? If you aren't using some sort of technical analysis then you are just guessing. Unless of course you want to share you system (which I doubt you will)

Like I said, I thought we were past all of this back and forth bullshit and were having some decent discussions around financials. Maybe the lefty crowd got to you for having decent conversations with big bad ILA and you had to maintain your street cred? No worries.

I wish you well with your investments as you sit on your 25% loss in Apple after buying it at the top. ;)
 
The Dude said:
I do know what he does as well as 20 other top billionaire investors.
I use those picks with standard and poorest rankings and my own opinions to pick from 20 blue chip stocks.
I do sell about 20 percent frequently in and out.
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Here is your own quote. You claim to sell 20% frequently in and out. So if you aren't using technical analysis how are you determining when to buy and sell? You claim using resistance and support levels along with moving averages is guesswork. Well, if you aren't doing technical analysis, what are you doing?
 
The Dude said:
You are as bad a market predictor as anyone who ever posted here.
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I never have predicted the market. I just follow the price of the S&P. But, lets get back to your active trading. How do you determine when to enter a trade and when to exit a trade. Surely you have a system in place don't you? Or do you guess?

I assume if you refuse to answer you are just guessing or lying.
 
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