Header & shoulder FAILED dramatically on GOOG

Discussion in 'Technical Analysis' started by tachart, Jan 3, 2007.

  1. tachart


    And it's so called one of the most reliable chart pattern.
  2. Thanks for the low-content post there buddy, you didn't even mention the timeframe you're looking at or provide a chart.

    As for "failed", I'm not sure what you think you're talking about. The typical distance from entry at the neckline break before the next pullback occurs after a head and shoulders is the distance from the top of the "head" to the neckline itself, which looks like is exactly what's happening here (assuming you're looking at a daily chart).

    I drew the neckline where price broke the previous swing-low on the "head", where it should be, and price appears to be making it's first pullback to the 20 ema right now, so I really don't think you know what you're talking about. Even if this isn't the case and the pattern DOES fail, it's too early to make that call.

    Especially if you're using market structure stops, which you should consider if you're trading a trend reversal pattern like a head-and-shoulders.

  3. I agree with pacfutures, that doesn't look like a failed pattern at all.

    Looks like GOOG is making a throwback to the shoulder trendline to "kiss it goodbye".
  4. tachart


    Sorry I didn't post the chart.
    Yes, you are right. I made the call too early.

    I think, the head is 513, neckline break point is 478. So we are looking for at least 443 area to complete H&S, or even lower to close the gap. Do you agree?
    Thanks for the chart.
  5. The GOOG H&S chart is i d e a l !
    The stock reached the target line and reacted quite gently.
    We do not often see such accurate chart.
    [I used zig percentage 1%]
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  6. tachart


    GOOG is trying to break H&S now.
    it's so bullish.
  7. Much more upside to GOOG.

    I know of at least 2 very large traders caught with their pants down holding GOOG short from 490. If it does manage to break above 490, the short covering on GOOG will result in the entire american stock market to new highs.
  8. empee


    this is odd, with the H&s breakdown, there was no volume, alas normally traders are getting short plus usually it gets pounded but there was no volume on the breakdown nor on the failure, this leads me to believe the breakdown occurred when no one (of any signficance anyway) was trading (around the holidays).

    Because of this we have a H&S rejection which will result in a short-term squeeze (now), most likely after it ends we re-test for the "real" breakdown test. (this assumes this test fails).

    The primary reasoning is the lack of volume on the breakdown and rejection. Usually you will get a nasty candle down and a high close with volume.

    Lets see what happens. 450 seems to be a support point as well, but we need volume. I think we at least test 450 with volume. just not today.

    the most likely result is we go test 500 again. a failure to hold above 500 for several days confirms this hypothesis.

    A blast off thru say 520 with volume would vacate this theory.

    I'm still think we test 450 after going to 510 area and failing.

    If we get up to 500+ area I might start shorting with a stop of a close above 520/525 or a upday with monster volume.