CLICK ON CHART TO ENLARGE
Traders appear to have created bearish Head & Shoulders patterns in the Copper complex and Europe. Each asset in the 4-pack above reflects a similar pattern, as each looks to be testing their neckline! Even though each of these assets are lower than their 2011 prices, should the neckline be taken out, technical analysis textbooks would suggest they would move much closer to their 2009 lows.
Each of these assets has bounced off of the current support lines over the past two years.
We live in a time, where assets are highly correlated/ move together…diversification has muted effects! The world needs these necklines/support to hold! A year ago patterns around the world all looked the same and they all moved in concert, to the downside. (see look alike patterns May 2011)
Risk assets across the board need these support lines to hold!
I am not a Bull nor a Bear….Just attempting to share what the Power of the Pattern appears to be saying. Remember these patterns are not created by me, they are created by investors around the world!
JJ….all of these pattern reflect that support is in place and it needs to hold! Neckline support is giving the boast to todays global action.
Question from a fundamental guy, in reference to the copper chart above: Are we looking a ‘failed breakdown syndrome’ rally? Thanks!
Jim…Is the Dollar crowded? Yes, see today Dollar post
Is support at hand? See yesterdays 4-pack of broad market index’s at support with an relative strength Adv/Decline line
This post, Europes H&S patterns, as mentioned in this post are not good from a big picture, yet the necklines have been support over the past couple of years and they still are.
Your observations Jim are top notch and always spot on….Thanks for sharing them,
But then again, your USD sentiment chart is in TBM land (crowded trade) which really means that the herd thinks the equities market will fall. USD should drop (as evidenced today) based on this USD crowded trade, which would suggest that equities and copper neckline will provide support for a at least a ST/IT/LT bounce. Thoughts?
Thank your for an outstanding webinar.
Boy did I get my $79 back many times over! I didn’t know what to expect from your webinar…I am so glad I attended.
You shared you wanted to give ideas that would last a lifetime, you delivered and more!
I now appreciate in a much deeper fashion how charts reflect human emotions and how we can use the patterns as your personal “maps to buried treasure!”
You helped me in the long-term and in the short term, as you shared you would. I am very interested in your new “Global Dashboards and Sector Extreme” research reports…how do I get them?
I would like for my family and friends to see this workshop. Is their any way for them to get a recording of what you shared yesterday.
Bottom line…one of the best 90 minutues I spent over the last many years!