Apple: During the Course of Failure

Tim Cook at the Apple Worldwide Developers Conference in San Francisco Photograph by David Paul Morris/Bloomberg

The High Pole: Earl Blumenthal, another famous point & figure chartist, developed this signal. The pattern is formed when a column of Xs exceeds the previous column of Xs by at least 3Xs and then gives up more than half of its total gains in the next column of Os. It is less of an actual sell signal than a warning signal. I do not pay much attention to it when the trend is up, but in a downtrend it can be very effective in picking up bear market rallies on the point or during the course of failure. Look how this formation picked up the failure of the bear market rally in the NASDAQ Comp in April 2002.

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