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Friday, January 30, 2015

Peter Brandt still doesn't impress me


Peter Brandt - major eruption ready to occur in global markets. Euch. Look how he starts off:

I have for several weeks and months maintained that the NYSE Composite will be the bell-weather for U.S. stocks. It has the clearest chart picture. The NYSE Composite is forming a near textbook continuation H&S pattern. The key upside levels are indicated on the chart. An upside penetration of these chart levels will usher in a sustained advance in U.S. equity prices.


1.22_NYA_D


It should be noted that this exact price configuration has produced giant price advances in the past. Charts of Gold and the DJIA are shown as examples.


1.22_DJIA_Q

OK, right there he's already made four mistakes.

1. The NYSE Composite (nowadays, at least) includes a large number of non-equities. It is its own beast, part bond and part equity. Don't try comparing it to things, you'll get burned.

2. He then compared a 6-month consolidation in the NYSE with an eighteen year consolidation in the DJIA.

3. Oh and the 18-year Dow consolidation had a fundamental basis that the 6-month NYSE consolidation doesn't.

4. And anyway, the H&S is not a continuation pattern.

I like the other things he says in the post, and can see a fundamental basis for thinking them, but as far as TA goes this just makes me shake my head.


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