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Shoulders

LONG Trading the head and shoulders patternsn the above chart, we notice from the left of the chart, that price was in a down trend. Soon, it establishes resistance level and drops lower only to rally back up to test the resistance. On successful test of the resistance, price drops back to make a lower low, forming the head and eventually makes the right shoulder. After this, price breaks the neckline resistance and starts to rally. In terms of the projected price, it is the measured distance from the head to the neckline, projected upwards from the break of the neckline. As can be seen from the chart, price continues on to rally making new highs.
Short
by ZubrMoldova
Trading the head and shoulders patternThe above chart, we notice from the left of the chart, that price was in a down trend. Soon, it establishes resistance level and drops lower only to rally back up to test the resistance. On successful test of the resistance, price drops back to make a lower low, forming the head and eventually makes the right shoulder. After this, price breaks the neckline resistance and starts to rally. In terms of the projected price, it is the measured distance from the head to the neckline, projected upwards from the break of the neckline. As can be seen from the chart, price continues on to rally making new highs.
Short
by ZubrMoldova
Short EURGBP - H&S forming in Supply ZonePurists will tell you not to trade the H&S until the neckline breaks. I tend to prefer the outcome of looking for a nice reversal on the right shoulder, because you're already in a zone of resistance as proved by the left shoulder and head. If you do see a good reversal pattern at this level, you have a good chance of returning to the neckline as an initial target and an even nicer reward if the neckline breaks and you head further down to confirm and complete the H&S pattern. In the case of EURGBP -0.23% I think this ties in well with a period of likely uncertainty for the EU, which is likely to cause headwinds for the Euro 0.11% and possible a flow of capital back towards the pound as the predicted brexit armageddon continues to fail to occur.
Short
by BobVanders
1
Possible Head & Shoulders FormingFirstly some fundamentals. Basic materials have dropped 4.4% in the last month and 5.7% in the last week. In this sector mining has seen a 7.83% drop in the last week and 12.49% in the last month (source finviz and stockcharts.com). This specific stock has performed worse with a weekly drop of 8.23% and 14.02% monthly. This gives an overall picture of weakness at this current point in time for this stock and industry. Going onto the chart I have firstly labelled the possible head and shoulders. Until the neckline is broken though (preferably on heavy volume that breaks the trend-line I've drawn for that) this is not a confirmed pattern. On the head I've drawn a box that incorporates a double top and a tweezer top which also has a bearish engulfing pattern. Below this a gap that doesn't get closed by the second box I've drawn on. This box is interesting in a few ways, firstly there is a moving average crossover of a 20 day MA and a 50 day MA (which is also resistance as the price on that day doesn't hold above the 50 day MA) indicating the short term trend has turned bearish. Another interesting point is that the candle is clearly a shooting star which is confirmed by a small gap down and a strong red candle after. This candle also falls on a crossover of the stochastic oscillator set at 5,3,3 with a neutral rating of 50 on the RSI. Volume has been contracting through the development of the possible head and shoulders and the longer term stochastic has also recently crossed over indicating more downward momentum. The RSI is currently on the support zone for a bull market which has been tested on numerous occasion throughout the bull phase of this move. There was a whipsaw signal given on the previous low which gave us our neckline. The price is currently on the 100 day MA and would be a further bearish signal if it were to break this line. Upon a successful completion of a breakthrough the neckline I would expect to see the following. Firstly the 100 day MA would turn to resistance. Secondly the RSI would drop to below 30 and below the previous low. The longer term stochastic would also drop below the 20 mark which is the lower boundary in that window. The price should drop to the 0.382 Fibonacci level where there is already support. It could then retrace to the neckline/100 day MA. This should give the Stochastic and RSI a chance to come out of the oversold region before the price falls further. The RSI should not exceed 65 on this retracement. The price target for this move, derived by the head and shoulders measuring implications are shown by the vertical line. The 0.5 Fibonacci level is also a good support level very close to the price target. The 200 day MA is also currently within the price zone marked by the rectangle adding another support function. Further bearish signals are lower lows and lower highs (right shoulder), a bearish harami on the 13th of this month, a confluence resistance of 26 at 41.21 (just above the shooting star) with the next strongest support of 6 being at 31.55, we also have a bearish MACD signal not shown on this chart (stockta.com source). Any questions welcome.
NYSE:NEMShort
by ivan.tory.56
EURGBP potential powerful head and shoulders top...Risk Disclaimer: The content published by this account is for demonstration purposes only and should never be considered financial advice. While speculative in nature before official news on Brexit - from a technical standpoint the EURGBP has been developing a potential powerful head and shoulders pattern on the larger time frames. The psychological barrier of .7900 sits near the neckline and has currently seen some solid price retracements from that zone. This idea is most likely invalidated if price breaks, and holds, above .7950 after any potential Brexit volatility.
Short
by fuse-forex
GBPCAD: Head and Shoulders PatternHey gang! Found a good Head and Shoulders Pattern right here on the GBPCAD! Head Resistance: 1.93000 Neckline Support: 1.90000 Profit target: 1.87000 Its a 300 pips profit! This is my strategy for trading Head and Shoulder Patterns. Take it with a pinch of salt! If you have any recommendations on how I can improve, please do comment here! :) When to enter: AFTER it breaks through neckline, it should retest the 1.90000 Resistance level again. My entry: 66% of my position will be in 1st Position 34% of my position will in 2nd Position My exit: SL at 1.90600 (60 pips) 1st TP: 50% of the pattern (150 pips) at 1.88500 2nd TP 90% of the pattern (270 pips) at 1.87300 What I learned from H&S so far: If the right shoulder is shorter than the left shoulder, the pattern is stronger If the right shoulder extends further than the left shoulder does, the pattern is stronger H&S Patterns have a 75% - 80% chance of succeeding (assuming it breaks through neckline) Good luck guys! May the pips be with you!
Short
by GenesisCTY
GBPAUD: H&S REVERSAL CONFIRMEDHi Traders, We have a lovely Head & Shoulders (H&S) reversal pattern here on GBPAUD. If you are looking for a short entry, see the chart above for a potential setup. The head and shoulders reversal is now complete with the break and close below neckline support. A pullback into that previous support level will give bears a solid opportunity to add to positions or re-enter short. IF we can stay below 2.0300, THEN I am expecting follow through to the downside to test 2.00 even handle. Good trading, Luke
Short
by Beebags
EURGBP: Pullback Right into the TrendHey guys! After EURGBP broke through last week or so with an absolutely beautiful Complex Head and Shoulder's Pattern, I spotted that the profit target for the H&S Pattern would actually pierce through the 0.74850 Major Resistance Level! (Pink line). Weekly also show a sharp downtrend, with the H&S Pattern head directly touching the 61.8 Fib level What influenced my decision: -General trend for Weekly is very bearish -Prices just retraced and reversed to the 61.8 Fib Level on Weekly -Profit target for H&S Pattern shows it would pierce through Hmm, for now, I'm staying bearish! If so, I'll probably wait for a retracement back to the level before selling! Maybe someone can shed some light on whether 0.74850 would hold? :) Complex Head and Shoulder's Pattern: thepatternsite.com Good luck guys! May the pips be with you!
Short
by GenesisCTY