From Peter L. Brandt:
Caveat: I am a chartist – I sniff fairy dust.
Caution: I am a trader, not an analyst. My going-in assumption on every trade is that I will be wrong and take a loss.
The charts would suggest that this week's rally in stocks will soon run its course – that the next 70 point move in the S&P 500 index will be down, not up.
Several chart observations are worthy of note:
The weekly chart exhibits a possible 18-month rising wedge. (Note: Patterns are only confirmed once their targets are reached. Until then, a chart pattern is only speculation. Guess what? Speculation is what traders do!)
Note that the market ran past the upper boundary of the wedge (possible wedge) in September in a movement we chartists refer to as a "last-gasp throw over."
The decline in earlier November completed this wedge (possible wedge). If this wedge interpretation is correct, the...
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