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Tuesday, April 17, 2012

Channel Surfing -- April 17, 2012

The analog I first posted about on the 9th [see: Analog Details] has performed well this past week.  Given the overnight action in the futures, it's about to get a boost in the right direction. 

A perfectly formed H&S pattern would mean a right shoulder in the 1400 range.  Though, as we pointed out yesterday, we already have enough of a right shoulder to matter.

For anyone interested, I posted Part 2 of Why Do Analogs Work? yesterday.  It details the 2011 as 2007/8 analog, and delves into the numerous chart patterns, fan lines, regression channels and harmonic patterns that took us from May to July of last year.

It's a decent guide to how these various patterns interacted and combined to generate a top, and subsequent fall -- helpful hints for times like these.

Stay tuned.


  1. PW - Once again a phenomenal post and call on the analog (at least for today).  Your call for up today/tomorrow fits perfectly with Daneric's Y-wave call (and also Pretzel's).  T

    FYI to other readers, calls like today's gains can easily cover site fees for next year ...

  2. hello Pebble..
    so..a lopsided H/S.. hmmm Maybe you'd also consider the entire 2009> rally of delusion..and a somewhat larger version too ;)

    I'm looking for sp'1395/1400 Wednesday...then i'll go short.

    good wishes, from the London Bunker.

  3. Hi Pebble,
    Been reading your blog here since last year and just now took a look at your new site.  What's the process for signing up??

  4. According to chart pattern guru Bulkowski, we get better performance from patterns with higher left than right shoulders and from upward sloping necklines.  In fact, as the pattern currently sits, it looks very similar to the example he's drawn on his website:

    A little lopsidedness is okay, but as I've been saying, a rise to 1400 would be ideal.  Hence, yesterday morning's call for "strong gains Tuesday and Wednesday before reversing."  The pattern could go as high as 1430 before it busts.

    I don't understand your question about the 2009 rally being a delusion.  I don't believe I've ever referred to it as such, in relation to this analog or otherwise.  Could you elaborate?

  5. Thanks, dillzs.  Hope you were able to make a little coin on it!  I'm always glad to see other forecasts that correlate, especially when they're generated by the use of drastically different methodology.

  6.  Hi Marco,

    I hope to have the registration page up this afternoon.  I'll post a notice here and on


  7. PW thanks for your work and analysis. I appreciate it

  8. re: 'rally of delusion'.

    Ohh, thats just a phrase that I often use to call all the action since the March'09 low. I realise we were pretty cheap at those levels, but...still, the whole rally is based on a mass delusion.

    I'd refer to 50% youth unemployment in Spain...along with 5000 other such dire factors, you know what I mean, I am sure.

    1430 ? Hmm, a new high, I'd guess that'd take 5 baby waves up, rather than 3..and besides, that'd break the bear flag I have.
    Oh well, I remain looking to short tomorrow, sometime around 1395/1405, the higher the better.

    *One thing I will look for at the WEdnesday open, black candles on the 15/60min cycles. If I see them, I'd be more comfortable with whacking a few short buttons.

  9. PW, Thanks.  I don't mean to give you more homework.  I have posted the question in your "Part 2 of Why Do Analogs Work?" too.  My question is why can't you use 2007-2008 to directly analyze the analog for 2012?

    You use 2007-2008 to analyze 2011.  Then you use 2010-2011 to analyze 2012.

    From your first chart in "Part 2 of Why Do Analogs Work?", I can see the Aug 2007 is the lowest point which is corresponding to March 2011 (Japan Earthquake).    And it is going to correspond to something in May 2012 to cause a decline?


    Pattern 1 (2007-2008)

    Two scenarios:

    (1)   Pattern 1 (2007-2008) as a first pattern which drive the 2nd pattern (2010-2012). The 2nd pattern
    drives the 3rd pattern (2012)


    (2)  Pattern 1 (2007-2008) as a main pattern which drive the consequent patterns in 2011 and 2012.

    In other word, if the answer is scenario 2, all you need to do to focus on Pattern 1 (2007-2008).

    Thank you!