The Head and Shoulder pattern seems to be emerging in tandem with a BULLISH crab formation that I mentioned in previous post.
Click link for Bullish Crab - or copy and paste...
Anyways... The shoulders are the key to this pattern as we already have a High @ 1.062 which forms the head. Price consolidated between 1.05 and 1.055 prior to the high and presently price is forming a range following the most recent high. Conveniently these action have formed the left and right shoulders and consequently the neckline @ 1.05. Don't be a stickeler and tell me the neckline is really somewhere in the 1.052 range, I would agree, but let's view price action the way the market makers do and look for solid price points.
This trade is valid as long as 1.056 is not violated and as you can see the targets are 1.048 and 1.044, which would be about a 61.8% extension.
Leave a comment below - Happy Trading!
Click link for Bullish Crab - or copy and paste...
Anyways... The shoulders are the key to this pattern as we already have a High @ 1.062 which forms the head. Price consolidated between 1.05 and 1.055 prior to the high and presently price is forming a range following the most recent high. Conveniently these action have formed the left and right shoulders and consequently the neckline @ 1.05. Don't be a stickeler and tell me the neckline is really somewhere in the 1.052 range, I would agree, but let's view price action the way the market makers do and look for solid price points.
This trade is valid as long as 1.056 is not violated and as you can see the targets are 1.048 and 1.044, which would be about a 61.8% extension.
Leave a comment below - Happy Trading!
Comment:
Looks like the shoulder limit may be 1.057 and not 1.056 like stated earlier. Close over 1.057 will invalidate this pattern.