Morgan: Double H&S Top - FAZ: Back At The Low

From yesterday morning on the Morgan Double H&S Top:

"The first one broke down and put 23.92 IN PLAY. The larger one in white broke down and put 22.00 IN PLAY."

Morgan went down immediately yesterday morning, and the 22.00 target got MADE. The low was 21.73, followed by a rally of nearly 10%, to 23.83.

"Take profits when targets get MADE."

From yesterday morning on the FAZ:

"If the FAZ now can do something like rally to 44.90 to form a neckline, pull back to something above 38.00, which would be the low of the Left Shoulder, then knock out the 44.90ish neckline, that would put roughly 55.00 IN PLAY."

The FAZ was strong coming out of the gate at the open yesterday morning. It went up to 44.90 resistance and printed a high of 45.02, establishing the second data point for a possible Bullish Inverse H&S pattern.

On the pullback, we were looking for a low at something above 38.00, for the Right Shoulder. The FAZ dropped nearly five dollars from 45.02 before finding a short-term bottom, at White #1. From there, it traced out a Bear Flag from which it broke down, at 40.91. That put a target of 38.68 IN PLAY.

Math:

42.49 - High of the Bear Flag
40.24 - Low of the Bear Flag

42.49 - 40.24 = 2.23 points of downside from the pattern break, at 40.91.

40.91 - 2.23 = Target: 38.68 IN PLAY.

The 38.68 target got MADE at 1:30PM (Yellow #1) The low was 38.64. At that point, the FAZ still was above the 38.00 low of the Left Shoulder, so that was fine, but it needed to look sharp and get moving up to the 44.90 - 45.01 possible neckline because a Right Shoulder should be narrower in width than the Left Shoulder, and the selloff from 45.02 was getting long in the tooth in terms of time.

The FAZ rallied off the 1:30PM low, but by 2:30PM, it looked stalled, and it came off the Double Top of 41.22 and 41.30 (Yellow #2 and Yellow #4). When the highs are that close in this price range, it's fine to call this an Ascending Triangle. Since the high at #4 was eight cents higher than the high at #2, if we want to be picky, it's a Bearish Rising Wedge.

That pattern broke down, and put a target of 37.87 IN PLAY. Uh-oh. That target was below the 38.00 low of the Left Shoulder, and the bottoming process had gone on too long to be a proper Right Shoulder, best seen in this 10-Minute chart.

After the 45.02 morning high, we were FOLLOWING the chart for evidence of something bullish, but what Ms. Market told us was that the Bear Flag broke to the downside, the Ascending Triangle (or Bearish Rising Wedge, if you will), broke to the downside, and both bearish targets got MADE. No sign of anything bullish.

The FAZ once again is in jeopardy of going into freefall on the downside if Monday's 34.80 low gets taken down by very much, but it's "neutral" at the close, above support. If the FAZ can successfully retest that low, the chart will be a Rectangle with similar highs and similar lows.

As always, I don't predict anything. Over the past week in the intraday charts, ELEVEN pattern targets have gotten MADE, but I don't have any targets IN PLAY at the moment.