As of 01/20/2021
  Indus: 31,188 +257.86 +0.8%  
  Trans: 13,126 +225.85 +1.8%  
  Utils: 865 +7.27 +0.8%  
  Nasdaq: 13,457 +260.07 +2.0%  
  S&P 500: 3,852 +52.94 +1.4%  
YTD
 +1.9%  
 +4.9%  
 +0.0%  
 +4.4%  
 +2.6%  
  Targets    Overview: 01/13/2021  
  Up arrow32,000 or 29,600 by 02/01/2021
  Up arrow13,500 or 12,300 by 02/01/2021
  Up arrow890 or 800 by 02/01/2021
  Up arrow13,500 or 12,400 by 02/01/2021
  Up arrow3,900 or 3,625 by 02/01/2021
CPI (updated daily): Arrows on 11/2/20
As of 01/20/2021
  Indus: 31,188 +257.86 +0.8%  
  Trans: 13,126 +225.85 +1.8%  
  Utils: 865 +7.27 +0.8%  
  Nasdaq: 13,457 +260.07 +2.0%  
  S&P 500: 3,852 +52.94 +1.4%  
YTD
 +1.9%  
 +4.9%  
 +0.0%  
 +4.4%  
 +2.6%  
  Targets    Overview: 01/13/2021  
  Up arrow32,000 or 29,600 by 02/01/2021
  Up arrow13,500 or 12,300 by 02/01/2021
  Up arrow890 or 800 by 02/01/2021
  Up arrow13,500 or 12,400 by 02/01/2021
  Up arrow3,900 or 3,625 by 02/01/2021
CPI (updated daily): Arrows on 11/2/20

Bulkowski's Yahoo 2 Trading Quiz

 

Released 12/17/2020.

YHOO: Quiz

Below is a slider quiz to test your trading ability. Captions appear below the pictures for guidance, so be sure to scroll down far enough to read them.

 

1 / 4
chart pattern
What chart patterns can you find? Look for the following: head-and-shoulders top, head-and-shoulders bottom, inverted and ascending scallop, cup with handle missing.
Answers are on the next slide.
2 / 4
chart pattern

The cup with handle seems to be missing the handle (or it's not very big) so you can call it a rounding turn. The head-and-shoulders top has broken out downward. If you owned this stock, should you sell? If not, should your short it?

Question 1: Do you buy, short, or avoid trading this stock?
Question 2: If trading this one, what is the target price?
Question 3: If trading this one, what is the stop price?
My answers appear on the next slide.
3 / 4
chart pattern

Answer 1 (buy?): The head-and-shoulders top shows a sell signal. If you own shares, sell them. Consider shorting but look for underlying support first. See the next slide. Support will help determine how far price may tumble.

Shown in blue are where I think the stock will find support. These areas match price congestion in Sept '04 and June '04. If so, the decline looks large enough to suggest a short sale might be profitable. The top blue line means an 8% decline and the bottom one is 14% down from the close.

Answer 2: See the above paragraph. Price may reverse somewhere within those blue lines...or it may continue down.

Answer 3: Place a stop above the right shoulder. That would mean an 8% loss. Volatility is $1.42, so a stop no closer than 38.40 would help prevent you from being stopped out on volatility. The right shoulder is at 38.90, so it's a perfect spot for a stop.

More on the next slide.
4 / 4
chart pattern

Price pulled back and almost hit the top point above the right shoulder but then declined. It found support at the lower blue support line in February '05 through March before rebounding.

I drew green circles around the points where price found support or resistance at the blue lines. I'm surprised the top line found such support.

The end.

See Also

 
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My novels:  Bumper's Story Head's Law

Chart Patterns: After the Buy Getting Started in Chart Patterns, Second Edition Trading Basics Fundamental Analysis and Position Trading Swing and Day Trading Visual Guide to Chart Patterns Encyclopedia of Candlestick Charts Encyclopedia of Chart Patterns 2nd Edition Trading Classic Chart Patterns

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