FCX - Doji Star Confirmation

"There must be some kind of way out of here,"
Said the joker to the thief,
"There's too much confusion,
I can't get no relief.
Jimi Hendrix - "All Along The Watchtower"

I hear those lyrics when I look at this chart. Although FCX put in a Doji Star on Thursday, which "could be" bullish, Friday was a "Gap And Crap" session. The open was 48.62, four cents below the bottom of the Falling Wedge (Blue Trendline #2-#4). In mid-May, that trendline represented QUINTUPLE resistance, prior to the Ascending Triangle breakout and subsequent rally to the top of the Falling Wedge.

On the pullback from 52.70, "former QUINTUPLE resistance at Trendline #2-#4 'should have been' support." It wasn't. It not only wasn't support, we got confirmation from Friday's candle that the trendline is resistance again, when we were looking for some confirmation that Thursday's Doji Star was bullish. UGH.

You see what I mean when I say that these candlesticks have to be viewed in the context of where they appear in the chart and in terms of what kind of confirmation we get, if any. All that we got from Friday's session was bearish confirmation.



In addition to the bearish confirmation that Trendline #2-#4 IS RESISTANCE again, we got bearish confirmation of a Head & Shoulders Top in the intraday chart.

After the "Gap And Crap" opening, FCX sold off to fill the gap, or partially fill it, which was fine. The stock rallied to a new high on the session, poked its head above Trendline #2-#4 resistance (that was fine), but then sold off to a session low, below the gap. Not so fine.

From that low, FCX rallied and formed a Rising Wedge (pattern in white). That' a continuation pattern and the majority of those resolve in the direction of the trend, and we know that the trend is bearish. Uh-oh-h...

The first white arrow was a validation of White Trendline #1-#3, validating it as support. When validated trendlines get taken out, that usually has "some" significance. We can see that it did when the pattern broke down at the second white arrow.

As we see so often, Rising Wedges frequently "morph," or change, into Bearish Head & Shoulders Tops, and that's exactly what this one did (the pattern in yellow). After the H&S Top broke down, The Bears got a brief "knuckle-biter" when FCX rallied back above the neckline. That rally called the validity of the breakdown in to question, but not for very long. At the first yellow arrow, FCX failed at the EMAs (Exponential Moving Averages), which were inverted. The faster EMAs were below the slower ones that succeeded them in the Fibonacci sequence.

The next three yellow arrows were bearish confirmations of "Yes, that neckline is resistance." ... "Yes, that neckline IS RESISTANCE." ... "YES, THAT NECKLINE IS RESISTANCE." (Ms. Market got annoyed with me and started shouting and slapping me upside the head for not shorting those bearish confirmations).

I shouted back at Ms. Market, "I'm not shorting it because I'm looking for bullish confirmations of Thursday's Doji Star, dang it."

Ms. Market said, "Fine! The H&S Top target of 47.64 just got MADE, and you didn't make any money, Melf. Have it YOUR way, you stubborn mule!"

Geez, Ms. Market can be a cruel mistress...

Kidding aside, as hard as I try to be objective, I still tend to see what I wanna see. I watched that H&S Top break down, and simply didn't want to see it. That lack of objectivity on my part cost me some nice $$$, and rightly so. I didn't FOLLOW what Ms. Market was telling me to do and, as we can see, she certainly was telling me loudly and clearly what I ought to be doing at TRIPLE resistance (last three yellow arrows), at that broken neckline. UGH.

What The Bulls need to do here:

1. Take out Friday's high of 48.80, which at least would get FCX back above that extremely annoying (LOL) Trendline #2-#4 resistance, and back into the Neutral Zone.

2. Take out the highs the tops of the Bull Flag (pattern in black) and the Rising Wedge (pattern in blue).

3. Take out the June 14 high of 50.38.

4. Get through Kumo (Cloud) Resistance

Note: Although we got some bearish confirmation on Friday, rather than any bullish confirmation of Thursday's Doji Star, "it ain't over 'til it's over." Look at the Doji Star of May 5 (blue #4 in the daily chart). The next session was a black candle, similar to what got on Friday. The following session was a white candle. That rally ended at Kumo (cloud) resistance, but the stock didn't tank right away