Chart patterns -- The funnel

Discussion in 'Technical Analysis' started by Pekelo, Feb 9, 2018.

  1. Pekelo

    Pekelo

    This morning we had the usually rare appearance of funnel or symmetrical wedge. I couldn't even find what it represent (continuation, etc.) except that the price eventually will leave the inside of the wedge with a vengeance. Because of the gap up, I was guessing down, and it did. But generally this is one of the hardest patterns to play, because the price range keeps widening (while forming a wedge) but still returning to the mid value. eventually of course it leaves but when that point is, it is anyone's guess.

    Anyhow, if someone knows how to read the direction after exiting the funnel, I am all ears...

    Also it looks like that the wegde's sides the former support became resistance. The chart below has an anomaly at 9:30, I think that was just the open's volatility when price exited early and should be disregarded.
     
  2. With 9:30 cash open, you have a lot of market-moving agendas geared up and just coming online. Whether net up or down, you're trying to figure them based upon (<9:30am) candles mostly formed before those agendas showed. Phew! FWIW, I don't think that's gonna happen.

    To be evidence-based, you've got to have evidence.
     
  3. volpri

    volpri

    What? You mean a megaphone or expanding triangle don’t you? Funnel..expanding triangle...megaphone...i suppose name not important...what is important is the PA and how to play it......There are ways to play this. May explain later. Busy at the moment.
     
    johnnyrock likes this.
  4. Pekelo

    Pekelo

    OK, can't wait. Well, the way I would play it is to enter the exiting side and just the funnel later on as resistance. But I couldn't find a description of what the expected direction is...
     
  5. Pekelo

    Pekelo

    OK, I have found it, turned out to be right, it is bearish, and expressing extreme volatility and indecision.

    "Expanding or Reverse Symmetrical Triangle
    Also known as a broadening top, an expanding triangle or a megaphone top, the reverse symmetrical triangle is a bearish indicator, and the technical implications are usually extreme.

    It is a rally to a new high, weakness to an intermediate support level. Then it’s a second rally to a higher high on increased volume and a decline through the intermediate support level. And, finally, there’s a third rally to a higher high on strong volume, followed by an eventual collapse.

    Again, this pattern develops because of indecision and extreme volatility."

    https://investorplace.com/2009/04/technical-analysis-101-triangles/#.Wn3YrYJzLIU
     
  6. speedo

    speedo

    I call it an expando or high speed wobble and the way I "play" it is to stay out and wait for resolution.
     
    Last edited: Feb 9, 2018
  7. I'm not into fancy formations and patterns, but wouldn't that qualify as a so-called "diamond" pattern? Anyway, too much Rorschach for me. I just see high-risk entry, therefore, no entry.
     
  8. Technical analysts are amusing. Y’all make things interesting. Head and shoulders to you all.
     
  9. volpri

    volpri

    Amusing and profitable.....ROFLMAO I.E. amusing to those who have not learned how to use them skillfully and profitable for those who have learned to use them and are psychologically prepared and trained for trading.
     
  10. Pekelo

    Pekelo

    There was another one I just didn't have the time to post it. Between 9:50 and 10:20 broke down as expected, then went back to the line where another opportunity to short it around 2636...

    Edit: Was good for more than 10+ points.
     
    #10     Feb 12, 2018