As of 10/23/2020   Indus: 28,336 -28.09 -0.1%     Trans: 11,880 +131.58 +1.1%     Utils: 894 +2.40 +0.3%     Nasdaq: 11,548 +42.27 +0.4%     S&P 500: 3,465 +11.90 +0.3%	YTD -0.7%    +9.0%    +1.7%    +28.7%    +7.3%	Targets    Overview: 09/29/2020     29,300 or 27,400 by 11/01/2020   12,000 or 11,000 by 11/01/2020   915 or 840 by 11/01/2020   12,800 or 11,300 by 11/01/2020   3,700 or 3,400 by 11/01/2020
CPI (updated daily): on 9/25/20

As of 10/23/2020   Indus: 28,336 -28.09 -0.1%     Trans: 11,880 +131.58 +1.1%     Utils: 894 +2.40 +0.3%     Nasdaq: 11,548 +42.27 +0.4%     S&P 500: 3,465 +11.90 +0.3%	YTD -0.7%    +9.0%    +1.7%    +28.7%    +7.3%
Targets    Overview: 09/29/2020     29,300 or 27,400 by 11/01/2020   12,000 or 11,000 by 11/01/2020   915 or 840 by 11/01/2020   12,800 or 11,300 by 11/01/2020   3,700 or 3,400 by 11/01/2020
CPI (updated daily): on 9/25/20

Bulkowski's Blog Archive: JAS

Blog Posting: March 7, 2008, Jo-Ann Stores

The chart shows Jo-Ann stores on the daily scale. From the low of 9.03 on January 16, price climbed to a high of 17.34 on February 14, a rise of 92%. I allow rises of over 90% in less than 2 months to qualify as high and tight flags. The theory says that price will pause for a few days or weeks and then continue higher for an average rise of 69% before the trend reverses.

I show this one as an example of what happens to many HTFs. Price does not close above the top of the pattern (shown as the red line) but tumbles instead. That is why I suggest waiting for a close above the highest high in the flag -- flagpole combination instead of just waiting for price to close above the flag's trendline (think of a congestion region with the top of it sloping down, following a trendline. In a flag, a close above the trendline would normally signal a buy).

For an example of a high and tight flag that worked, see Stillwater Mining company (SWC). The HTF appears as a small congestion region from February 11 to 14 after a flagpole climb from 7.42 to 15.42, or 108% in about 3 weeks. Price then continued up to a high of 22.72, two days ago, for an additional climb of 47% from the flagpole high. It has dropped since then (closing today, March 6, at 18.37).

Jo-Ann Stores: Aftermath

Price did, in fact, continue lower, just as the blog entry suggested. The drop reinforces the need to wait for price to close above the top of the chart pattern before taking a position.

-- Thomas Bulkowski

 

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