ChartAdvisor.com says head and shoulders developing on SandP and Dow

[#1]

ChartAdvisor says: It is interesting to note that this pattern is forming near the resistance of the 200-day exponential moving averages, which is also a level that is used by traders to suggest that nearby resistance could become a going concern within the next few weeks. It wouldn't be surprising to see additional selling pressure enter the markets once the prices of these large cap indexes close below their respective necklines.

[divz]

see the ftse has broken 4200 which has been quite an important support will be interesting to see where it closes today

[pb41]

I read somewhere that because the developing pattern is so obvious to everybody there is a possibility it will be faded. This will mean the markets move in the opposite direction to that expected and catch a lot of traders on the wrong side. Therefore I would be a bit careful in assuming that this H&S pattern should be traded to the downside. Probably best to wait and see how it plays out.

[#4]

Well I have taken a put on the stx40, but if all fails will concentrate on composing more music for my music download site http://www.ilike.com/artist/Swayseeker (there are 3 free tunes anyone can download) Regards Swayseeker

[#5]

Even if this H/S on the S&P had to break what would the target be ? 23 points ??

[pb41]

See this video from Market Club which points out that the S&P could fall by 75 points to around the 805 level if the H&S neckline is broken at 880. The 75 points is measured from the top of the Head at 955 to the neckline at 880. http://broadcast.ino.com/education/sp500_update_200907/

[pb41]

Some more info on this: http://blog.afraidtotrade.com/head-and-shoulders-and-divergences-on-daily-sp500/#more-4248