Potential Triangle Right Shoulder On H&S
Trader Moe | Apr 22, 2015 01:38AM ET
It’s weird that today’s falling megaphone didn’t quickly break out upwards to its retrace target, and it’s weird that the late-day potential price channel along the formation top didn’t continue down to the channel bottom.
Often multiple weird events like this mean a triangle is forming.
If a triangle right shoulder develops here for the H&S, it would usually break out downwards.
It would also eliminate retrace requirements up here, though not retrace requirements for various older megaphones on the chart.
What that means is we could see a bounce off the big ES triangle bottom at roughly 2040, but we could also see a plunge straight to 1950 before a retrace to the 2050 area.
We could also see another new high after the coming dip to the 3-year price channel bottom if the correction doesn’t have a crashy enough candle in it.
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