Slope of Hope Blog Posts

Slope initially began as a blog, so this is where most of the website’s content resides. Here we have tens of thousands of posts dating back over a decade. These are listed in reverse chronological order. Click on any category icon below to see posts tagged with that particular subject, or click on a word in the category cloud on the right side of the screen for more specific choices.

How Momentum Ends

By -

Long-time Slopers are well-acquainted with my puzzlement over the success of Chipotle. Let me be clear at the outset: there are very few people on this planet who enjoy good Mexican food more than me. Here in the Silicon Valley, we are blessed with zillions of inexpensive and delicious Mexican fare served at family-owned eateries. Give me a five dollar bill, and I can provide you with a fantastic-tasting burrito.

But when I wrote my post last March, I was puzzling not only on the completely bizarre price action of the stock but also what the reasons for the company's success could be. I ate there a few times, and the two things I remember about the food were that (a) it was expensive; and (b) it wasn't especially good. I also was amused at the self-aggrandizing placards on the wall declaring that some (some!) of their ingredients were organic. Well, gee-whiz.

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EEM Weekly H&S and Daily H&S Patterns (by SB)

By -

Below are a Weekly chart and Daily chart of the Emerging Markets ETF
(EEM)
.

A very large Head and Shoulders pattern
has been building on the Weekly timeframe since September 2009.
Price is retesting a zone in the vicinity of the right shoulder and appears
poised for another attempt at a break above.

Within the right
shoulder is another smaller Head and Shoulders pattern, which
has been building since August 2011 on the Daily timeframe.
Price is retesting the September 14th "shooting star," the high of which
represents the top of the right shoulder (which is still forming) on this timeframe. Furthermore, a
bullish moving average "Golden Cross" formed two days ago, and,
once again, price closed just above the 50% Fibonacci retracement level today.
Volumes have picked up a bit over the past couple of days.

If price
breaks and holds above 43.00, the next level of resistance is
the top of the Daily "head" and Weekly "right shoulder" at
44.91 (if it can make it above the 60% Fib level at
43.93).

You can see how
EEM is performing compared to the BRIC
countries
, as shown on the 6-Month Daily charts below.
If we see India and China weaken, we may see the others, including EEM,
follow suit. All five bear a close watch over the next few days, as any
weakening, in the near-term, may negatively affect U.S.
equities.

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