Wednesday, May 25, 2011

Is this stuff starting to work?

Now that QE2 is winding down, has anyone noticed that good old technicals are starting to work slightly better?

Here is a stock I found this morning as I thumbed through charts with the ignorant bliss of someone not watching earnings reports and corporate news.
To me, it was a head-and-shoulders-like pattern with broken support. Money was bleeding out with nary a blip during the April rally, too.

I can feign ignorance or, as some of you might say, claim ignorance, when it comes to premarket earnings news. I am a technical analyst, after all, and should not care. Of course, TAs are aware of this stuff, even if it does not factor into the analysis.

But here we have a chart with a classic breakdown before the big news broke. Perhaps there is hope for chartists after all.

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