Tuesday, July 31, 2012

Charts 7-31: Three Peaks and a Domed House

Carl Futia has been tracking a count of George Lindsay's famous Three Peaks and a Domed House pattern.  3PDH is one of our favorite patterns, and we were delighted to see it form on the TLT ETF several years ago.

I see it in the SPX, too, but at a different scale of time than Carl does.  I know that the original pattern specifies a timeline, 7 months for certain segments to form, and so forth. If we can set that aside, I will make a case for 3PDH on the SPX on the chart since 1158.  You could count it from 1074 if you like, too, it doesn't make any difference in the final target, which would be a sharp return to point 10, or 1266 on my chart.

The big-picture proposed 3PDH count since 1158

Two tops possible for tomorrow, sane and vicious

The move up since point 10, and the Domed House

Overnight /ES futures just went green, so we will see if this can continue overnight and what sort of day we get tomorrow.  I think the 1398 top is more likely, but 1422 is possible if the market really likes the bone thrown to it by the Fed.  The problem with 1422 is that we would reverse off it right away, presumably on Thursday when the ECB flops.

Over the weekend, we were car-camping outside of Leavenworth, and my daughter found a rubber boa snake.  They are docile and can be handled.  This was the second one I have seen in the area, both at night (the first time I was coming out from a day hike of the Enchantments, because I'm too cheap to get an overnight permit).  It must be a sign.

1 comment:

christiangustafson said...

Another important possibility here is that the 8/2 full moon marks a BOTTOM (just like the June 4 full moon), we put in point 22 in the 3PDH model, and head north to SPX 1422 to 1440.