Short Term Trading Member Forum

[techcharter]

The recent head and shoulders pattern.

Elliott Wave International has a tease-promo regarding the recent head and shoulders over the last 8 to 10 months.

http://www.elliottwave.com/freeupdates/archives/2011/08/15/A-BIGGER-Head-and-Shoulders-Formation-What-s-Next-in-THIS-Pattern.aspx

"Sometimes a short-to-intermediate-term target can be derived by taking the number of points between the head and the neckline and subtracting that total from where prices break the neckline..."

They also go on to say that there is a MULTI YEAR head and shoulder pattern in play. I did my research, all 5 seconds of it, and conclude the dotCom bubble formed the left shoulder, the housing bubble formed the head, and the sovereign debt bubble is forming the right shoulder.

http://bigcharts.marketwatch.com/advchart/frames/frames.asp?show=&insttype=Index&symb=spx&time=20&startdate=1%2F4%2F1999&enddate=8%2F15%2F2011&freq=3&compidx=aaaaa%3A0&comptemptext=&comp=none&ma=0&maval=9&uf=0&lf=1&lf2=0&lf3=0&type=2&style=320&size=4&timeFrameToggle=false&compareToToggle=false&indicatorsToggle=false&chartStyleToggle=false&state=9&x=35&y=21

Applying the proposed general formula, the SPX should drop below the 200 point level. I'd say sooner that 2 years.