Inverse Head- Shoulders Pattern-Higher Time Frame Good Target
Hello Fellow Traders,
Once again i have come up with a Learning Idea on a Pattern I spotted while scanning my charts. We will discuss about Head and Shoulders Pattern
1. Introduction - The inverse head and shoulders pattern is another technical analysis chart pattern, and it is essentially the upside-down version of the regular head and shoulders pattern. This pattern is also considered a reversal pattern, but in this case, it signals a potential reversal from a downtrend to an uptrend.
2. Easy Recognition of the Pattern - This visual pattern is named for its resemblance to a human head and shoulders and is opposite of regular Head and shoulders Pattern
3. Components of Inverse Head and Shoulders Pattern- It consists of FOUR key components:
First - Left Shoulder: Occurs after a downtrend, where the price drops to a low and then experiences a rally. In this case the low is at 305 from where we saw the price reversal taking place. This led to the formation of the left shoulder.
Second Head: Following the left shoulder, the price declines again to form a lower low. After this low point, there is a subsequent rally, and the peak is typically higher than the left shoulder. The lower low was formed at 278 levels. This confirmed the formation of the head and reversal of the price from below.
Third Right Shoulder: Similar to the left shoulder, the price drops for the third time but usually does not reach the low of the head. After this low, there is another rally in price. In this case the right shoulder low was identified at 330 and after that price reversal was seen
Fourth - The Neckline - a critical level drawn across the Highs between the left shoulder, head, and right shoulder. A decisive break above this neckline is considered a confirmation of the Inverse head and shoulders pattern, signaling a potential reversal from an Down Trend to a Uptrend.
4. Target in Inverse Head and shoulders Pattern - In The pattern the target is marked as per the chart. We take the base of the head to apex as the target. The same i have marked on the charts of AEGISCHEM for your consideration.
5. Stop Loss - Inverse Head and shoulders Pattern - Once the neck line becomes invalid that is the indication that the pattern has become invalid and the trade must be closed.
Please Boost and Like to motivate me. Love you all
God Bless You.
Once again i have come up with a Learning Idea on a Pattern I spotted while scanning my charts. We will discuss about Head and Shoulders Pattern
1. Introduction - The inverse head and shoulders pattern is another technical analysis chart pattern, and it is essentially the upside-down version of the regular head and shoulders pattern. This pattern is also considered a reversal pattern, but in this case, it signals a potential reversal from a downtrend to an uptrend.
2. Easy Recognition of the Pattern - This visual pattern is named for its resemblance to a human head and shoulders and is opposite of regular Head and shoulders Pattern
3. Components of Inverse Head and Shoulders Pattern- It consists of FOUR key components:
First - Left Shoulder: Occurs after a downtrend, where the price drops to a low and then experiences a rally. In this case the low is at 305 from where we saw the price reversal taking place. This led to the formation of the left shoulder.
Second Head: Following the left shoulder, the price declines again to form a lower low. After this low point, there is a subsequent rally, and the peak is typically higher than the left shoulder. The lower low was formed at 278 levels. This confirmed the formation of the head and reversal of the price from below.
Third Right Shoulder: Similar to the left shoulder, the price drops for the third time but usually does not reach the low of the head. After this low, there is another rally in price. In this case the right shoulder low was identified at 330 and after that price reversal was seen
Fourth - The Neckline - a critical level drawn across the Highs between the left shoulder, head, and right shoulder. A decisive break above this neckline is considered a confirmation of the Inverse head and shoulders pattern, signaling a potential reversal from an Down Trend to a Uptrend.
4. Target in Inverse Head and shoulders Pattern - In The pattern the target is marked as per the chart. We take the base of the head to apex as the target. The same i have marked on the charts of AEGISCHEM for your consideration.
5. Stop Loss - Inverse Head and shoulders Pattern - Once the neck line becomes invalid that is the indication that the pattern has become invalid and the trade must be closed.
Please Boost and Like to motivate me. Love you all
God Bless You.
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