Ask Colin

Something of interest, I have noticed what I think is a head and shoulders pattern on FHF dated the 13th of Feb 2001. The target pull back would initially be approximately $8.88 now that the neckline has been broken. What interests me is that the Coppock indicator gives a buy signal. On back testing the Coppock indicator, it certainly gives very reliable signals. My limited understanding tells me that after this pull back, FHF may very well re-establish a nice uptrend. I am not asking for trading advise, just your opinion. Perhaps the pattern is not a true head and shoulders.

The FHF pattern does not look to me like a head and shoulders. It is not that clearly formed and I rather like to see more volatility in the formation of the shoulders and head. By that I mean that they each look more like V-Tops. I think this is important, because there is always a lot of emotion in genuine tops. This one looks to me (with a couple more weeks of data than you had) more as though it may turn into a rectangle. But that is all speculation.

I see the point you identified as the break down out of the pattern. It did not follow through then or since. It would have taken me out of the trade, as you know, because it is one of my exit signals. However, it was not by reference to a head and shoulders.

Regarding the Coppock, I do not use it for individual stocks, though others do. I have not seen the testing and in any case, along with Ed Coppock, I see better ways to trade individual stocks, which I taught you in the seminar. I put a Coppock on the FHF chart, though, just to look. On my chart it is in positive territory and rising. Nowhere near a buy signal.