Technical Analysis of Stock Trends

A dangerous triangle…

Posted on Mar 19, 2018 by WHC Bassetti in Letters

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Readers may reacquaint themselves about triangles in the 10th ed. of Technical Analysis of Stock Trends. Chapter 8.   Prices are in a triangle — or rather breaking down out of a triangle.  This is not good news.  While there is substantial similarity in the charts there is another interpretation  possible of the S&P  chart.

In this version the breakdown bar gets included in the triangle.  Whichever version is the best remains for time to reveal, but we don’t need time to forecast what lies in the near future:  volatility! volatility!  voltility!

Also the breakdown probably presages  more downside action.  We intend to pare back our portfolio and batten down the hatches.  Note that the Basing Point stop is intact.  Long term investors have to grin and bear it knowing they will win in the long run.