The analog I first posted about on the 9th [see: Analog Details] has performed well this past week. Given the overnight action in the futures, it’s about to get a boost in the right direction.
A perfectly formed H&S pattern would mean a right shoulder in the 1400 range. Though, as we pointed out yesterday, we already have enough of a right shoulder to matter.
For anyone interested, I posted Part 2 of Why Do Analogs Work? yesterday. It details the 2011 as 2007/8 analog, and delves into the numerous chart patterns, fan lines, regression channels and harmonic patterns that took us from May to July of last year.
It’s a decent guide to how these various patterns interacted and combined to generate a top, and subsequent fall — helpful hints for times like these.