2 replies to this topic

[TechMan]

After 6 consecutive days of volume divergence, the NDX gapped up yesterday and subsequently formed 3 successive hook-like patterns. Repetitive patterns always caught my attention like repetitive codes or signals.

I've been watching their development with great interest as they grow similar in height yet dissimilar in width and angle. And, the volume has turned from positive correlation (blue arrow) to negative (red arrows).

The price action seems to be losing momentum on successive repetition of the "hook", which is verified by the negative correlation of the volume.

By all means, had you seen this pattern before, I'd welcome your input and insight. For now, I'd just call it the 3-hook pattern. I'd even consider something like 3 hooks and a ….

In any case, another repetitive gap down should be anticipated tomorrow.

Edited by TechMan, 17 February 2011 - 05:46 PM.

[Will]

Zoom out to a 60m chart and it just looks like a bullish flag similar to the chart below. Break the highs and that's what it is. A top here and you can call it 3 hooks.

Edited by Will, 17 February 2011 - 06:46 PM.

[TechMan]

Zoom out to a 60m chart and it just looks like a bullish flag similar to the chart below. Break the highs and that's what it is. A top here and you can call it 3 hooks.

Probable except for a couple of things. (1) The upper and the lower trendlines aren't really "parallel". (2) There's not much "slanting"; the upper trendline's almost horizontal. It's the "slanting" that gives the bull flag formation the spirit.