Posted on Nov 15, 2014 by WHC Bassetti.
It is gratifyig to have intelligent and alert readers. One of whom looked at the above chart and said, isn’t this a broadending pattern? Broadening patterns have large implications and are usually top formations. Here is a chart of the 2000 top — a broadening formation which turned into a diamond.
(p.133, 10th edition)
Posted on Nov 12, 2014 by WHC Bassetti.
As the official potifex maximus of the rule of seven mystery we looked at the recent wave and came to the conclusion that we are at the beginning, not the end. This is occasioned by the sell-off of October. When the technician detects the beginning of a new wave he may attempt to gauge the eventual target of the wave by applying the rule of seven (http://www.edwards-magee.com/ggu/ruleofseven.pdf ).
Posted on Nov 06, 2014 by WHC Bassetti.
Posted on Oct 31, 2014 by WHC Bassetti.
The old Chinese proverb regarding mind control is “Kill the chickens to scare the monkeys.” We have just witnessed an example of this, complete with spurious trendline breaks. Meanwhile we have scared the pants off uneducated investors — and some sophisticated investors too. Smart money (?) seized on oversold prices and lit a rocket which is still soaring. Our analysis of the pattern proved dead right on. It is an alphbetaetc. Naturally there has to be a short term reaction to prices which have boomed like this, but the long term appears clear. In fact the PnF method looks for a target of 2380.
Posted on Oct 24, 2014 by WHC Bassetti.
Readers, investors, traders — everybody — is (are) taking a deep breath and nervously looking over his shoulder to see if the Halloween market is gong to serve up some more tricks. The first seven or eight days of this drama were like a boxing match — take a punch to the head which would sideline Ray Rice, then get revenge the next day, everything back to normal — but no, another punch to the head. File this period in your mind and keep the chart. You may be staggering around, but you’ve lived through some historic market action. And we are back to markets we can at least analyze.