October 14, 2008
Head and Shoulders
By Planet Wealth
Last month we looked at the Head and Shoulders (H&S) pattern that had formed on the XAO.
The week commencing 15/09/08 was a confirmation bar, of a Lower Peak(LP) below the key Moving Average (MAV), so that meant the XAO had LP and LT below the MAV (a very bearish signal) as well as the H&S(another bearish signal). This particular week also pierced the neckline of the H&S pattern, but failed to close below, so there was still caution about wether the H&S had been confirmed.
Two weeks later we saw a close below the neckline, confirming the H&S pattern. In one week (this week), the XAO has managed to reach the projection, which also happens to be a support line. With all the bearish signals the charts have been giving us, should we be suprised this week fell so hard?
Now for the next question: Is this the bottom of the market or is there more to come?
(click on image to enlarge)
Topics: Technical Analysis | 1 Comment »
July 26th, 2010 at 11:03 am
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