Comments on: S&P 500 Forming Head & Shoulder Pattern? http://www.ritholtz.com/blog/2009/01/sp-500-forming-a-head-shoulder-pattern/ Macro Perspective on the Capital Markets, Economy, Geopolitics, Technology, and Digital Media Tue, 14 Feb 2012 21:16:44 +0000 hourly 1 http://wordpress.org/?v=3.0.5 By: Cooter http://www.ritholtz.com/blog/2009/01/sp-500-forming-a-head-shoulder-pattern/comment-page-1/#comment-142646 Cooter Fri, 30 Jan 2009 05:25:36 +0000 http://www.ritholtz.com/blog/?p=17410#comment-142646 Funny how the SPX double top never got any play on the blogosphere but now a sketchy H&S pattern is seeing a lot of words. Funny how the SPX double top never got any play on the blogosphere but now a sketchy H&S pattern is seeing a lot of words.

]]> By: Cooter http://www.ritholtz.com/blog/2009/01/sp-500-forming-a-head-shoulder-pattern/comment-page-1/#comment-142645 Cooter Fri, 30 Jan 2009 05:20:29 +0000 http://www.ritholtz.com/blog/?p=17410#comment-142645 Worst... Head and Shoulder... pattern... ever Worst… Head and Shoulder… pattern… ever

]]> By: bruerr http://www.ritholtz.com/blog/2009/01/sp-500-forming-a-head-shoulder-pattern/comment-page-1/#comment-142351 bruerr Thu, 29 Jan 2009 05:22:11 +0000 http://www.ritholtz.com/blog/?p=17410#comment-142351 And government will be free to focus on fubar-foreign policy again. Let Obama and the common repaint some school buildings. Drink up lads. Be sure to use condoms. And government will be free to focus on fubar-foreign policy again. Let Obama and the common repaint some school buildings. Drink up lads. Be sure to use condoms.

]]> By: bruerr http://www.ritholtz.com/blog/2009/01/sp-500-forming-a-head-shoulder-pattern/comment-page-1/#comment-142350 bruerr Thu, 29 Jan 2009 05:11:36 +0000 http://www.ritholtz.com/blog/?p=17410#comment-142350 If banks are successful through representative agents Geithner/Paulson to unload their debt on others, the stock market will view that like a victory won't they? ... Be like a frat having a 20-keg party. Fed creates a shell entity to receive toxic assets, but pays a premium for the toxic assets. Then banks sell their debt at .80 cents on the dollar? Holy smoke! No wonder they half jokingly call it a bad bank. Fed does not foreclose on banks that are friendly with Geithner/Paulson. Collects the toxic assets in one location, and bundles them like mortgages originated by another lender. Bundles were sold to a sucker client at a premium (good for them), with a derivative enabling a big mark-up (good for them), competitor banks and other banks begin to fail/are acquired (good for them), bad debt is written off against profits providing tax benefits on that toxic part they had to re-acquire (good for them); and then those same toxic assets are sold again (good for them): Debts are re-sold to government for .80 cents on the dollar (good for them). Government poses as another sucker-buyer, even greater sucker than the first sucker. Paying .80 cents on the dollar? (Good for them.) No private entity would pay that much for those assets. Government buyer waits so they can take write downs and benefit by not paying tax on those assets. Approximate .30-.35 cents on the dollar tax benefit, claimed against taxes otherwise owed. Bad bank hanky-panky, is the first step needed to escape accountability for having done anything wrong. Not out of that woods completely, but after a bad bank entity is created and implemented, the chances of sweeping accountability dwindle; leaving only a few to take the hatchet (who will probably get off lightly in the future if at all). Suffice to say, if they get this, they are one step closer to evading scrutiny and accountability. This is akin to a coup isn't it? A financial Coup d'état. ...allows them to consolidate their positions, obtain acquiescence of the populace (or the surrender of the government's charter to protect them), and survive the conflict in a refortified manner. Thats a huge win for the top 2 percent. I know its like cheating in monopoly, but the market could rally on that for some time couldn't it? I mean the floor traders will be celebrating that around the world. If banks are successful through representative agents Geithner/Paulson to unload their debt on others, the stock market will view that like a victory won’t they? … Be like a frat having a 20-keg party. Fed creates a shell entity to receive toxic assets, but pays a premium for the toxic assets. Then banks sell their debt at .80 cents on the dollar? Holy smoke! No wonder they half jokingly call it a bad bank.

Fed does not foreclose on banks that are friendly with Geithner/Paulson. Collects the toxic assets in one location, and bundles them like mortgages originated by another lender. Bundles were sold to a sucker client at a premium (good for them), with a derivative enabling a big mark-up (good for them), competitor banks and other banks begin to fail/are acquired (good for them), bad debt is written off against profits providing tax benefits on that toxic part they had to re-acquire (good for them); and then those same toxic assets are sold again (good for them):

Debts are re-sold to government for .80 cents on the dollar (good for them). Government poses as another sucker-buyer, even greater sucker than the first sucker. Paying .80 cents on the dollar? (Good for them.) No private entity would pay that much for those assets.

Government buyer waits so they can take write downs and benefit by not paying tax on those assets. Approximate .30-.35 cents on the dollar tax benefit, claimed against taxes otherwise owed.

Bad bank hanky-panky, is the first step needed to escape accountability for having done anything wrong. Not out of that woods completely, but after a bad bank entity is created and implemented, the chances of sweeping accountability dwindle; leaving only a few to take the hatchet (who will probably get off lightly in the future if at all).

Suffice to say, if they get this, they are one step closer to evading scrutiny and accountability.

This is akin to a coup isn’t it? A financial Coup d’état. …allows them to consolidate their positions, obtain acquiescence of the populace (or the surrender of the government’s charter to protect them), and survive the conflict in a refortified manner.

Thats a huge win for the top 2 percent. I know its like cheating in monopoly, but the market could rally on that for some time couldn’t it? I mean the floor traders will be celebrating that around the world.

]]> By: harold hecuba http://www.ritholtz.com/blog/2009/01/sp-500-forming-a-head-shoulder-pattern/comment-page-1/#comment-142339 harold hecuba Thu, 29 Jan 2009 04:16:02 +0000 http://www.ritholtz.com/blog/?p=17410#comment-142339 it amazes me how 10 different people can look at the same chart and all 10 see different patterns. anyone see the hopper handle formation forming that would dictate a decline to around 450 in the s+p? it amazes me how 10 different people can look at the same chart and all 10 see different patterns. anyone see the hopper handle formation forming that would dictate a decline to around 450 in the s+p?

]]> By: formershrink http://www.ritholtz.com/blog/2009/01/sp-500-forming-a-head-shoulder-pattern/comment-page-1/#comment-142330 formershrink Thu, 29 Jan 2009 03:30:07 +0000 http://www.ritholtz.com/blog/?p=17410#comment-142330 @ Ken Re: empirical research on "head and shoulders" pattern: http://web.mit.edu/alo/www/Papers/1705-1765.pdf OK, I found it for you. Now you tell me what it means. @ Ken

Re: empirical research on “head and shoulders” pattern:

http://web.mit.edu/alo/www/Papers/1705-1765.pdf

OK, I found it for you. Now you tell me what it means.

]]> By: Steve Barry http://www.ritholtz.com/blog/2009/01/sp-500-forming-a-head-shoulder-pattern/comment-page-1/#comment-142310 Steve Barry Thu, 29 Jan 2009 01:45:09 +0000 http://www.ritholtz.com/blog/?p=17410#comment-142310 @tk...you are very correct...and this pattern is all on light volume. I'd much rather use sentiment indicators like put/calls and short interest levels. The only chart patterns I look at are multi-year patterns...I do like TA for resistance and support levels when timing a buy or sell...but then I haven't traded in almost 2 years. @tk…you are very correct…and this pattern is all on light volume. I’d much rather use sentiment indicators like put/calls and short interest levels. The only chart patterns I look at are multi-year patterns…I do like TA for resistance and support levels when timing a buy or sell…but then I haven’t traded in almost 2 years.

]]> By: tk138 http://www.ritholtz.com/blog/2009/01/sp-500-forming-a-head-shoulder-pattern/comment-page-1/#comment-142300 tk138 Thu, 29 Jan 2009 01:24:09 +0000 http://www.ritholtz.com/blog/?p=17410#comment-142300 It's not an inverse head and shoulders until it breaks out. until then, it's congestion or consolidation. I rely on TA but it doesn't predict anything. It identifies higher probability entry and exit points for overbought and oversold reversals, and defines the presence and absence of trends. Anyone looking for the future in the past should buy a crystal ball. there is no certainty and the markets can do anything. For every potential H&S pattern you can show me, I can dig up a hundred charts that didn't break out, but fell back into bases or choppy trading ranges or resumed the previous trending direction. if it breaks above the neckline, and holds that break. if it does it on volume, and if the trend indicators confirm, I'll accept it and act on it. It’s not an inverse head and shoulders until it breaks out. until then, it’s congestion or consolidation. I rely on TA but it doesn’t predict anything. It identifies higher probability entry and exit points for overbought and oversold reversals, and defines the presence and absence of trends. Anyone looking for the future in the past should buy a crystal ball. there is no certainty and the markets can do anything. For every potential H&S pattern you can show me, I can dig up a hundred charts that didn’t break out, but fell back into bases or choppy trading ranges or resumed the previous trending direction. if it breaks above the neckline, and holds that break. if it does it on volume, and if the trend indicators confirm, I’ll accept it and act on it.

]]> By: Steve Barry http://www.ritholtz.com/blog/2009/01/sp-500-forming-a-head-shoulder-pattern/comment-page-1/#comment-142280 Steve Barry Wed, 28 Jan 2009 23:09:02 +0000 http://www.ritholtz.com/blog/?p=17410#comment-142280 Since this is a TA thread... today marked the 44th straight trading day QQQQ volume was at or below its 100 day MA. A similar period last March-June was followed by total disaster for longs. The 10 day equity put/call is in a tricky situation here...if the market is strong the next two days, it will drop right back to a possible double bottom at multi-year lows. Since this is a TA thread…

today marked the 44th straight trading day QQQQ volume was at or below its 100 day MA. A similar period last March-June was followed by total disaster for longs.

The 10 day equity put/call is in a tricky situation here…if the market is strong the next two days, it will drop right back to a possible double bottom at multi-year lows.

]]> By: royrogers http://www.ritholtz.com/blog/2009/01/sp-500-forming-a-head-shoulder-pattern/comment-page-1/#comment-142279 royrogers Wed, 28 Jan 2009 23:08:52 +0000 http://www.ritholtz.com/blog/?p=17410#comment-142279 the only head and shoulders pattern I see is a bullish head of barry and his 2 big , broad shoulders. Barry must be bullish today. the only head and shoulders pattern I see is a bullish head of barry
and his 2 big , broad shoulders.
Barry must be bullish today.

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