Head and Shoulders formations

[Sean K]

Some potential forming up here.

 

[Sean K]

Some potential forming up here.

LOL, was just scanning some stocks and came up with the same one as above.

Looks promising on a break through the neck at $60 which is also long term resistance back to early 07.

 

[Moneybags]

LOL, was just scanning some stocks and came up with the same one as above.

Looks promising on a break through the neck at $60 which is also long term resistance back to early 07.

Interesting Kennas, thanks for posting, volume not very encouraging.

MB

 

[Sean K]

Has LEI been mentioned?

Looks ordinary.

This is on my blue chip potential buy for the grandkids list too...

Now on the short list.

And I didn't short it on the breakdown, like a rabbit in the spotlights.....

Or, maybe the short ban was on then...

 

[joeyr46]

Could do. On a 3 year weekly still looks vulnerable to revert back until it breaks 29 ish, IMO. Or, the effect of the H&S when it broke down through 26 and hit 23, is all it could manage to the downside.

I think it has to break 30 on volume but that will complete a inverted H&S have tried to include chart but not sure I got it

 

[joeyr46]

LOL, was just scanning some stocks and came up with the same one as above.

Looks promising on a break through the neck at $60 which is also long term resistance back to early 07.

Long term looks like it supported on trend line c ould be a good move if volume picks up on break Thank you

 

[Sean K]

COH has failed at the neckline, but the formation still in play longer term.


BHP just failed at a neckline of some sorts.

Break through target $42.

 

[Sean K]

COH has failed at the neckline, but the formation still in play longer term.

BHP just failed at a neckline of some sorts.

Break through target $42.

BHP false break for a day at $32 and hovering under again. The Chartist has been shorting it around that level, so we can blame them. lol

COH moving back up towards this great wall at $60. Would be surprised in Nick was shorting it around these levels too.

 

[Tukker]

So im trying to get my head around this head and shoulders method. Can someone confirm if this is an example of one?

Thanks

 

[Wysiwyg]

So im trying to get my head around this head and shoulders method. Can someone confirm if this is an example of one?

Thanks

Yes but what significance at the bottom of a trend???Your example is usually a topping pattern.An inverse H&S for a bottoming pattern is illustrated below by kennas (BHP) but the likelihood of it panning out as a bottoming pattern is highly unlikely under present economic circumstances.


p.s. the right shoulder is ill-defined at this stage so I wouldn`t jump to conclusions like that.

 

[Sean K]

So im trying to get my head around this head and shoulders method. Can someone confirm if this is an example of one?

Thanks

Tukker, This isn't a really great example of a H&S, but nonetheless there. It's a bearish H&S and you look to short these on a break down through the neckline. Target about $25 ish. But I'm not sure how valid this one is, the right shoulder is a bit weak.

 

[Wysiwyg]

Tukker, This isn't a really great example of a H&S, but nonetheless there. It's a bearish H&S and you look to short these on a break down through the neckline. Target about $25 ish. But I'm not sure how valid this one is, the right shoulder is a bit weak.

Also worth remembering kennas ...

The Breaking of the Neckline and the Potential Return Move

As seen from the below, the head-and-shoulders pattern is complete when the neckline is broken; the trend is then considered reversed, and the security should be heading in a new direction. The point of breakout is when most traders following the pattern would enter the security.

However, the security will not always just continue in the direction suggested by the pattern after the breakout. For this reason it's important to be aware of what is known as a "throwback" move. This situation occurs when the price breaks through the neckline, setting a new high or low (depending on the pattern), followed by a retreat back to the neckline.

I would add to that ... not only back to, but beyond the neckline sometimes.

 

[Tukker]

Tukker, This isn't a really great example of a H&S, but nonetheless there. It's a bearish H&S and you look to short these on a break down through the neckline. Target about $25 ish. But I'm not sure how valid this one is, the right shoulder is a bit weak.

Right, i think i am beginning to understand. So what point would the right neckline be established? If the price went sideways for a bit and then broke below the neckline established at around $35, or is it more like 37?

 

[Sean K]

Right, i think i am beginning to understand. So what point would the right neckline be established? If the price went sideways for a bit and then broke below the neckline established at around $35, or is it more like 37?

Around 37 at the moment. As was mentioned though this right shoulder is pretty weak and another factor is that it's actually making some higher lows and highs which is a positive sign. Not a high probability of this one turning out imo, so that means it will!

 

[nomore4s]

Head and shoulder formations are a reversal pattern.

So the pattern on RIO isn't really valid - sorry Kennas - as RIO is already in a strong down trend, you could argue it's a continuation pattern on the RIO chart maybe. I would actually put Rio in an ascending triangle atm which could be either bearish or bullish depending on which way it breaks

You want to see true head & shoulder patterns either at the top or bottom of trends. Although I don't think you will find many at the top of trends atm
BHP and COH currently are good examples - COH is very noticable on the weekly chart, both just need to activate now - especially BHP, if it can't break the neckline with conviction on the next attempt the pattern would change, already it's borderline imo.

 

[nomore4s]

COH example on the weekly chart

 

[tradingftw]

Would anybody care to comment on this NXS pattern? Wondering if the spike down in early October invalidates the H&S pattern? Also should the fact that the neckline was not broken in early Feb be taken as failure or is it possible to have a cup and handle within the overall pattern on the RS?

Cheers

Tim

 

[OzWaveGuy]

Would anybody care to comment on this NXS pattern? Wondering if the spike down in early October invalidates the H&S pattern? Also should the fact that the neckline was not broken in early Feb be taken as failure or is it possible to have a cup and handle within the overall pattern on the RS?

Cheers

Tim

Haven't followed NXS, but the pattern shown strongly resembles a triangle - Indicating a breakout to the downside, followed by a reversal.

 

[Wysiwyg]

As stated elsewhere, after the head and shoulder formation, a tendency to revisit the neckline is observed.

Example just recently of the djia doing exactly that.Note the timing on the hour. A loosely orchestrated game I suggest.

 

[Sean K]

This looks to be breaking up.