- a wise stock market person of days gone by
EVERYONE was talking about the hammer candle on the major indices yesterday. Such resilience! Hammer out that bottom!
Well, today's column talks about how that hammer is not the same as previous hammers in the stock market. I won't give away the reasons here so you will make my editor happy and actually visit Barrons.com but I will give you something that I removed from the article.
This is a monthly chart of the S&P 500. It may not be quite textbook but that is a possible evening star pattern and as its name suggests, the sun is setting on the market. Only a major rally over the next two days (to end the month) would negate that view.I cannot find any instances of this pattern on a monthly chart going back the beginning of my data (on eSignal). However, if you have the data you will see one in 1937. The result was not pretty.
2 comments:
Since I posted this, the Dow went from up 40-ish to down 60. So much for the hammer.
And on that 'hammer day', market internals still finished mostly negative. It was hardly one of those 'climactic' reversals -- though I was surprised that the market couldn't even hold its meager bounce of today.
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