Monday, September 12, 2011

Megaphones and pennants

FAZtabulous?

11:23 am (Hawaii) Not a chartist, technician or astrologer. In fact, headline risk rules just about every significant move in the market. But it's still interesting to see the price action, ie psychology of crowd behavior, as it is in FAZ. On Friday, I observed with my amateur telescope that FAZ was in a pennant move short term and a megaphone explosion longer term. China-saving-Italy rumor withstanding, FAZ moved back into the pennant range by today's close. If not for the rumor, FAZ likely would have boosted from its 66+ open and well past 70. This shit is not for the easily disturbed. Buying at near-term highs is stupid. That's why I keep an eye on this and refuse to chase.

I gave up some gains when I bought at 54+ last week, sold at 60 and saw it run to 66-67. But I do not believe in infinite uptrends and I have no regrets about selling then. This week will likely bring the close of this pennant formation and then on to the next near-term phase. Would not be at all disappointed with 55 or 50. China will do only so much to clean out the toxins of Euro and US banksters.

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