This is a continuation of
.. where I discussed the merit of drawing necklines based on candle bodys or candle wicks.
Let's rewind a little and examine a previous heads and shoulders pattern in this SAME downturn when we hit $65k. If we draw the neckline using candle bodies, we end up with the thick yellow line. Look what happened when we broke the neckline: the price meandered about for a couple of days around the neckline before plunging EXACTLY to the right price as predicted by this yellow line H+S pattern. Then we enter into a second heads and shoulders that is playing out right now.
This confirms to me that the neckline IS drawn at the candle body for the BTC market at least.
.. where I discussed the merit of drawing necklines based on candle bodys or candle wicks.
Let's rewind a little and examine a previous heads and shoulders pattern in this SAME downturn when we hit $65k. If we draw the neckline using candle bodies, we end up with the thick yellow line. Look what happened when we broke the neckline: the price meandered about for a couple of days around the neckline before plunging EXACTLY to the right price as predicted by this yellow line H+S pattern. Then we enter into a second heads and shoulders that is playing out right now.
This confirms to me that the neckline IS drawn at the candle body for the BTC market at least.