Prophet Patterns

A big thanks to Tim Knight and his team over at Prophet.Net for creating some of the web's top charting software available. Duane offered the first response to the post asking for topics. He said...

"Jeff, Do you use Profit Patterns to screen stocks and if so, have you been successful with those trades?"

I am sure there are individuals out there that are not familiar with Prophet Patterns, so let me provide some background. Prophet was rated by Barrons as the #1 Site for Technical AnalysisBest Websites for Investors 2001, 2002, 2003, 2004. They are also an INVESTools company.

They offer a highly regarded tool for technicians called "Prophet Patterns." Here is a snapshot of what it looks like.


This image is a commodity, since the only people who can get access to this tool is through the Active Investor program. This means you would need to come to Utah for the 4-day live class, and then you are given access to this tool. You cannot purchase this tool from prophet individually, even if you pay for their platinum package. It is reserved for only the elite students!

Anyhow, if you look at this page it is a search engine designed to look specifically look for patterns. If you want to find triangles, wedges, channels, topping or bottoming formations, this is your ticket to easy pattern recognition!

You can classify which pattern you want to find, how recent the breakout was, or if it has not happened yet. You can set the timeframe in which it took to form, specify continuation or reversal, and the patterns are ranked on different strength indicators...basically meaning you can sift through many to find the more dynamic patterns. The target prices they establish are amazingly accurate. They have a proprietary algorithm to set their target and you would be surprised how many reach this destination.

Going back to the question..."do I use this, and have I been successful with these trades"... yes, and yes. I must be honest though. My preference is to use watchlists to look for patterns. This way I can control the type and quality of stocks that I find patterns in. When I first used this tool I had made the comment that "this is as close a computer can get to performing magic." I was blown away by the capabilities and results. I still am blown away by it, but my preferences and pickiness has led me back to my watchlists more often...but since I teach the Price Patterns class each week, and some weeks there are not any patterns I can find, I go back to this old reliable tool to help me do the work.

In your position, look at it this way. Obviously I have trained my eyes to find these a lot quicker than the norm. It literally takes me 30 minutes to look through 1800 thumbnail charts each week. It might take someone just learning patterns a full week to do this. At this point I would recommend it to users who want to find things quickly. Then you can sort through all the patterns to find the quality and types of stocks you want to find patterns in.

This was probably longer than it needed to be, but a good question nonetheless. Thanks!

Jeff,

When you look at charts for patterns what time frame do you use....6 months, 1 year or longer? Thanks.

Harold

Thumbnail charts only include 6 months of data. My choices here are limited.

Jeff,

FAF had a nice Flag pattern fail today on earnings. It gapped lower today ending up closing in the middle of the range. The lower range hit diagonal support, previously resistance, formed from the high in mid Dec to mid Aug. There seems to be horizonal support around 38 and stronger horizonal support again at 36 and 30. The double top (?), the end of May and mid Sept seem to give a downside target of 30.

Is my analysis accurate? Comments?

Duane

If you go to www.Autochartist.com, this company actually provides the charting capability to Investools / Prophet. To verify this, go to autochartist's website and you then can select the "Subscribe"(http://www.autochartist.com/subscribe.htm) at the top of the page and scroll down and you will see Investools is one of their clients.

Additionally, you can suscribe separately to Autochartist ($39/month, i believe). I tried their 21 day free trial, but wasn't overly impressed. By the way, it truly is a free trial, they don't ask for any credit card info or anything.

The biggest difference I found, is that the charts (from autochartist) are not pulled up on the interactive chart (prophet), you only get a screenshot (no drawing capability).

Take it for what it's worth.

Hi Jeff,

This is completely unrelated to this post but in case you need another idea for a topic tomorrow could you talk about if the election effects the markets? I've only been trading for a few months so I've never watched the markets through election time.

Thanks

Post a Comment
...I'M AN OPTION ADDICT...I'M AN OPTION ADDICT...I'M AN OPTION ADDICT... ...I'M AN OPTION ADDICT...I'M AN OPTION ADDICT...I'M AN OPTION ADDICT...

About me

  • I'm Option Addict
  • From Saratoga Springs, Utah, United States
  • I am a professional trader and an instructor for Investools. I've had relations with the markets for 9 years. Born in Concord, CA, but reside in Saratoga Springs, Utah. Father of THREE, Husband of one.
My profile

Prescriptions Here!

Other stuff

Blogarama - 
The Blog Directory
Directory of 
Finance/Business Blogs Finance 
blogs Top Blogs Finance Blogs - BlogCatalog Blog Directory