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Headandshoulderscomplete

Bullish End of Year?This chart shows the price development of Alphabet (Google). Since reaching its high in July, the stock has been in a downward correction. However, it now appears that this correction may be ending. The price has formed a higher low, which could serve as the right shoulder in an inverse Head & Shoulders pattern. Additionally, the SMAs are bullishly aligned once again. If the price breaks above the 38.2% Fibonacci level, I anticipate a bullish move toward the end of the year.
NASDAQ:GOOGLong
by p4917
2
How to Plot Head & Shoulders Pattern on TradingViewWelcome back, Traders! We’re excited to have you here on TradingView where we share valuable trading insights and educational posts to help you succeed in the markets. Today, we’re diving into one of the most reliable chart patterns in technical analysis: the Head and Shoulders pattern. Understanding and identifying this pattern can significantly improve your trading strategy, whether you’re dealing with forex, stocks, or commodities. What is the Head and Shoulders Pattern? The Head and Shoulders pattern is a bearish reversal pattern that indicates a potential end to an uptrend and the beginning of a downtrend. It consists of three peaks: Left Shoulder: The first peak followed by a decline. Head: The highest peak followed by a decline. Right Shoulder: A peak similar in height to the left shoulder, followed by a decline. The neckline is the support line that connects the lows after the left shoulder and the head. How to Trade the Head and Shoulders Pattern: Identify the Pattern: Look for the three distinct peaks with the head being the highest. Draw the Neckline: Connect the lows after the left shoulder and the head to form the neckline. Entry Point: Enter a short position when the price breaks below the neckline. Target: Measure the distance from the head to the neckline and subtract this distance from the breakout point to set your target. Stop Loss: Place a stop loss above the right shoulder to manage your risk. Inverse Head and Shoulders Pattern Conversely, the Inverse Head and Shoulders is a bullish reversal pattern signaling the end of a downtrend and the start of an uptrend. It consists of three troughs: Left Shoulder: The first trough followed by a rise. Head: The lowest trough followed by a rise. Right Shoulder: A trough similar in depth to the left shoulder, followed by a rise. The neckline is the resistance line connecting the highs after the left shoulder and the head. How to Trade the Inverse Head and Shoulders Pattern: Identify the Pattern: Look for the three distinct troughs with the head being the lowest. Draw the Neckline: Connect the highs after the left shoulder and the head to form the neckline. Entry Point: Enter a long position when the price breaks above the neckline. Target: Measure the distance from the head to the neckline and add this distance to the breakout point to set your target. Stop Loss: Place a stop loss below the right shoulder to manage your risk. Follow us on TradingView for more helpful ideas and educational posts! Stay tuned as we continue to share insights that will help you on your trading journey. Happy trading! - BK Trading Academy
Education
by BKTradingAcademy
7
How to trade head and shoulder pattern? As a forex trader, it's essential to have a robust arsenal of technical analysis tools at your disposal. One of the most powerful and reliable chart patterns you can use is the "Head and Shoulders" pattern. This pattern is prized for its ability to signal potential trend reversals, allowing traders to make informed decisions and capitalize on market opportunities. In this comprehensive guide, we'll delve deep into the Head and Shoulders pattern, breaking down its components, identifying its variations, and learning how to trade it effectively. Understanding the Head and Shoulders Pattern The Head and Shoulders pattern is a classic reversal pattern that forms after an extended uptrend, signaling a potential change in market direction from bullish to bearish. It consists of three peaks, with the middle peak (the "head") being higher than the other two peaks (the "shoulders"). The pattern typically unfolds as follows: 1. The Left Shoulder - The left shoulder represents the first peak after a strong uptrend. - This peak is typically followed by a minor retracement, creating the first trough. 2. The Head - The head forms after a brief rally from the left shoulder's low point. - It represents the highest peak in the pattern and usually exceeds the previous peak. - After reaching this peak, the price retraces again, forming the second trough. 3. The Right Shoulder - The right shoulder is the third and final peak in the pattern. - Like the left shoulder, it is lower than the head and forms after a minor rally. - The right shoulder's high is followed by a retracement, creating the third trough. Key Characteristics of the Head and Shoulders Pattern To effectively identify and trade the Head and Shoulders pattern, it's crucial to understand its key characteristics: 1. Symmetry - The left and right shoulders should be roughly symmetrical in terms of height and width. - The head should be the highest point in the pattern. 2. Volume - Volume plays a vital role in confirming the pattern. - Volume should generally decline as the pattern forms and then increase as the price breaks below the neckline (more on this later). 3. Neckline - The neckline is a trendline drawn horizontally connecting the low points of the left and right troughs (the shoulders). - The neckline serves as a critical level of support. A breach of this level confirms the pattern. Trading the Head and Shoulders Pattern Trading the Head and Shoulders pattern involves two main steps: identification and execution. Identification: 1. potting the Pattern: Begin by identifying a well-defined Head and Shoulders pattern on your forex chart. 2. Volume Confirmation: Ensure that volume decreases as the pattern forms and increases upon breaking the neckline. 3. Neckline: Draw a neckline connecting the lows of the left and right shoulders. Execution: 1. Entry Point: Place a short trade when the price breaks below the neckline. This serves as a signal that the pattern has confirmed. 2. Stop-Loss and Take-Profit: Set a stop-loss order above the right shoulder and a take-profit order based on your risk-reward ratio. 3. Risk Management: Be mindful of risk management, and never risk more than you can afford to lose on a single trade. Variations of the Head and Shoulders Pattern While the classic Head and Shoulders pattern is powerful, variations can offer additional insights: Inverse Head and Shoulders: - An inverse Head and Shoulders pattern signals a potential bullish reversal. - It comprises three troughs with the head being lower than the shoulders. - The pattern is confirmed when the price breaks above the neckline. Complex Head and Shoulders: - Complex variations may have multiple heads or shoulders, making them harder to spot. - Despite their complexity, they follow the same principles of confirmation through neckline breaches. Conclusion The Head and Shoulders pattern is a valuable tool in the forex trader's toolkit. By mastering its identification and execution, you can gain a competitive edge in the market. Remember that no pattern is foolproof, and risk management remains paramount in forex trading. As with any technical analysis tool, it's essential to combine the Head and Shoulders pattern with other indicators and analysis methods for a well-rounded trading strategy. So, start practicing, keep refining your skills, and always stay informed about the latest market developments to become a successful forex trader.
Education
by forexorbit
Sell GBPCHF Head and Shoulders PatternI have posted about this in my previous idea on 22nd of June saying there is a Head and Shoulders pattern on the 4H timeframe. Now price is breaking the neckline to complete the head and shoulders formation. Now is the time to sell at the close of the current candle.We also have RSI divergence giving extra confluence. I believe we don't need this large stop loss that I have said in my previous idea (which was 1.14444) but instead a tighter stop might be better and make more sense of the current long bearish candle. Trade Setup: Entry - At the close of the current candle Stop Loss - 1.14124 Take Profit - 1.11679 Good Luck and happy trading.
Short
by fayezhazzem
📊How To Trade: H&S Pattern📍How to Identify and Use the Head and Shoulders Pattern The head and shoulders pattern is characterized by key features to look out for on trading charts. It typically occurs after a bullish uptrend when buying pressure begins to fade. The pattern includes a left shoulder, a higher middle peak, and a right shoulder approximately at the same level as the left shoulder. Additionally, the pattern should have a distinct neckline acting as a support level. ✔️To successfully identify and trade the head and shoulders pattern, consider the following step-by-step approach: 🔹 Look for three distinct tops , namely the left shoulder, head, and right shoulder, which occur after an uptrend. 🔹 Identify the neckline support level , which connects the lowest points of the left and right shoulders. 🔹 Wait for a breakout to occur, confirmed by a candle closing below the neckline. 🔹 Once the breakout is confirmed, place a selling order to capitalize on the bearish reversal signaled by the pattern. 🔹 Implement a stop-loss order above the neckline, ideally positioned at the highest level of the right shoulder, to manage risk effectively. 🔹 Consider using a risk-reward ratio to determine a suitable target for taking profits, ensuring the potential reward justifies the risk taken. Lets consider the following example below as a step by step to identify the pattern. This is what it would look like in a real scenario: Step 1: Price is moving on an uptrend and starting to form the head and shoulder peaks Step 2: We can identify the neckline which we can observe price react as a temporary support which connects the lower peaks. We need to wait for a clear breakout in order to find an entry insert s2.png image here Step 3: Price broke below the neckline and re-tested the neckline so we enter a short position on the re-test with taking profit target the length of the head to neckline insert s3.png image here Step 4: We can see the pattern was correct and it hit our targets insert s4.png here 👤 @‌QuantVue 📅 Daily Ideas about market update, psychology & indicators ❤️ If you appreciate our work, please like, comment and follow ❤️
Education
by QuantVue
9
BTCUSDT Breakout - Follow Short TF DayThe reversal pattern Head and Shoulders was formed successfully with a strong price rejection when it re-tested on the uptrend-neckline around 28k, which is the greatest entry point for a swing short position. Although the best swing short opportunity for shorts have been missed, opportunities for shorts are still there. Follow short when the price breaks below strong support zone at 26550 Plans: - Follow short if price close below 26550 - Stop Loss if the price rise above 26550 after a false break - Take Profit at 25250 and 23850 respectively If a false break occur in the opposite direction (reversal to uptrend), this would be a great Long entry with a target to TP at 28k
Short
by ChartTrail
Cashing in on Chaos: A Short USD/JPY Breakout Sell-Stop Trade"Dear Tradingview family, Symbol: #USDJPY Strategy: #Breakout_sell_Stop Trade. Trade Call Type: #Short. Indicators: #Price_Action. #Chart_patterns, #Head_and_shoulders Bearish breakout. #RSI_Divergence. RichTL Entry: Short when price breaks below the neckline of weekly H&S Pattern, Weekly Support line and Weekly Trendline. Anchor Time Frame Weekly Trading Time Frame: Daily. Entry Price: 126.701 Stop Loss: 138.469 Take Profit 1: 112.960 Take Profit 2: 100.426 Take Profit 3: 1.10239 Risk Reward Ratio TP1: 1: 1.7 TP2: 1: 2.17 Methodology As an accomplished and highly knowledgeable forex expert with extensive experience in trading various financial instruments, including crypto and stocks, I shall employ a meticulous methodology that entails a comprehensive examination of the price action and critical levels, while utilizing a blend of indicators and chart patterns. My approach shall involve seeking out promising trendlines, as well as support and resistance levels that may present opportunities for price reversal, with the aid of our indicators that will serve to substantiate the reliability of our analysis. Once I have completed my assessment, I will ascertain the optimal entry and exit points for our trades, in addition to determining the most suitable stop loss level that will enable us to prudently manage risk. Analysis My analysis of the USD JPY chart reveals a clear Head and Shoulders pattern on the weekly timeframe, supported by a bearish divergence seen on the RSI indicator from the left shoulder to the head price. Despite the price struggling on a daily support line, there are no strong indications from the daily and weekly RSI to suggest a breakdown of this support at this time. I anticipate that the price may rise to encounter resistance in order to expand the width of the right shoulder and create a double top pattern prior to breaking the current support level. Once the support level is breached, the next move will be to proceed with a breakout of the Head and Shoulders pattern, which may potentially lead to a breach of the next strong weekly support and weekly trendline that has been in effect since December 2020. My sell stop entry will be executed once this breakout occurs, following the conclusion of the ongoing tug-of-war between the bulls and bears. This entry will be akin to a smooth descent, much like jumping down from a waterfall. Conclusion: Drawing from our analysis, I have identified a viable opportunity for a short trade. My take profit targets are situated at key support levels on the chart, namely S1 and S3. The RRR at S1 is 1:1.7, while S3 offers a more balanced risk to reward ratio of 1:2.17. My strategy will entail securing partial profit at R1 before trailing the stop loss to the entry point. Overall, I am optimistic about the success prospects of this setup based on our technical analysis. However, it is imperative to remain vigilant and closely monitor the price action to make any necessary trade adjustments in response to new information that may emerge.
Short
by The_TradingW0LF
LUNA PONZI PLAYED OUT PERFECTLYThis LUNA chart that I charted back in February speaks for itself. Head & Shoulders target met, Diamond Top pattern hit. BTC dumped November, LUNA went onto pump and make ATH. The fake out is the best I have ever seen as I said in previous post. LET me be clear, I do not follow the news so I did not no what happened with LUNA until my girlfriend told me to check the charts when I was at work. I was not surprised because the charts show you the news before it happens days, weeks, months in advance. One ENTITY and one person making the moves is called a Composite, which makes this a centralised project (centralised finance). I hope this chart shows people to remove emotion and zoom out. NOT FINANCIAL ADVICE.
by Fakeoutking82
5
What is Head and shoulders pattern and how to trade with that?*The Head and Shoulders ( Bearish ) pattern is one of the most popular and best known price patterns in trading. This is a very accurate trading signal if you know how to use it properly and flexibly. *What is Head and Shoulders? How to identify and characterize Head and Shoulders is the name of a special type of price pattern that usually appears at the end of uptrends. This is a signal of future downtrends. It is called Head and Shoulders because the shape of this pattern on the price chart is similar to that of the human body including Left Shoulder, Head, and Right Shoulder. The line connecting the two troughs of the shoulders is often called the neckline. In fact, this pattern is perfect when the Neckline is horizontal (the prices of the two lows are approximately the same). How to trade with this: ENTRY POINT : Right after the candlestick breaks out of the neckline (or at the Retesting the neckline ) STOP-LOSS : At the peak of the right shoulder. TARGET : Usually, Head and Shoulders is a pattern for starting a downtrend. Therefore, adjust the first target to the height of the neckline to the top (H) of the pattern and adjust the next targets according to the past price and chart. This is the academic shape of this pattern, in the future we will publish other types of head and shoulder patterns 📚 . Please follow our page to be informed as soon as the materials are published. Thank you all for supporting our activity with Likes 👍 and Comments ❤️
Education
by NamchaTa
Ethereum: A clear path ahead for the end of 2021Head & Shoulders Explained The Head & Shoulders Pattern & Inverse Head & Shoulders Patterns are quite common on Bitcoin and have had great results on the higher timeframe charts. Here are the main characteristics: • VOLUME MIMICS PATTERN • 3 PEAKS, LEFT & RIGHT SIMILAR HEIGHT • TRIANGULAR IN APPEARANCE • FOUND AFTER UPTREND • HIGH SUCCESS RATE • CAN BE SLANTED Price forms 3 distinct peaks after a strong uptrend, the left and right peak should have a similar height (shoulders), the middle peak (head) has to be the highest or this can not be a HS pattern . They should seem triangular in appearance but as long as it fits the main characteristics can still be a valid pattern. The right shoulder should form a lower high which is a early sign of trend change, this is entry A, with entry B being the bearish retest of of the “neckline” (marked on chart #2). The idea is to gain an early entry on the pattern at point A to maximise profits and reduce risk. Once price moves above the middle "peak" it is likely that the pattern is not valid anymore so this allows us to get a tight stop loss upon entry. We measure the height of the pattern and add it to the breakout level for a maximum possible price target. Volume should also paint the same pattern with the 3 peaks, strong volume on breakout increases success rate. ----------------------------------------------------------------- What is General Pattern Failure? General Pattern Failure occurs when a chart pattern breaks out, fails to hit target, quickly reverses then rejects off that same breakout level back inside the pattern continuing in the opposite direction of the breakout. Pictured above in the original post on the left (its quite small but zoomed out to get the bigger picture) is a normal breakout on a Head And Shoulders Pattern. Note how it matches the first example (top left, "Normal Breakout"). General pattern failure can also be considered a Liquidity Grab or can be referred to as a “Fake Out” also when it happens more rapidly after the original pattern breakout. In this example (top right as the example, pointing to the live chart at bottom right) it has come back up to the Head & Shoulders pattern after a long extended period of time, this doesn't mean the failure still cannot occur. Once price gets back inside the pattern chances of higher prices are more probable. ----------------------------------------------------------------- Learning to trade patterns such as these can provide great opportunities if you understand price action and how to identify the key areas of the pattern that other traders and investors may be focusing on too, these areas become important psychological levels on the chart. If you found the idea insightful please share, like or comment, Thank you!
FTX:ETHUSDLong
by Worth_The_Ri5k