It certainly 'looks' like a double top, does this 2.5x3 high/low chart, and there is an activated target to the downside of 1,255 (the 1,240 is not active). And the 'less noisy' 5x3 H/L chart (not shown) also has an active target to the downside of 1,245. However, the 1,400 and 1,382.5 targets to the upside are still active (as is that 1,355 target) and the closing 2x5 p&f chart looks totally different. All in all rather inconclusive.We will know soon enough if there is a double top pattern in play as the symmetary of this chart pattern will have to hold, which means looking for the market to trend lower over the coming days/week. If we see the market move higher (through 1,327), i'd be of the view that this pattern is redundant and a move through 1,337 would confirm that, as the price will have moved above those two columns of 0's from which those downside targets are based.
Thanks EV. It's been a long, long time since I truly understood or used P&F charts. I guess I need to find the time to brush up on how to construct them and how they work. But I trust them as a great method to reduce the noise. I've bookmarked your site and will come back in the future to read your interpretation of what you're seeing.
ReplyDeleteAll the best!
AR
Thanks for the comment AR, much appreciated. I used P&F more at my previous Co where we had Updata's TA software, which was excellent. It's by no means the only tool in the box but the daily charts can give some useful context. If you wanted a refresher book, i'd recommed Tom Dorsey's 'Point and Figure Charting' or Jeremy du Plessis 'Definitive Guide to Point and Figure Charts'. Both excellent.
ReplyDeleteAnd I hope you keep up your postings on CIL by the way - appreciate the views. Rgds, EV