Category: Money tips Release Date: 2006-03-15
Head and shoulders bottom pattern is a bullish bottom reversal pattern. Although not common, but once there, the trend of their representatives will be very accurate signals. Since the second half of the formation of the Shanghai and Shenzhen market index fell, and many stocks are out of the head and shoulder movement patterns may be the end, some of the stock has formed a head and shoulders bottom pattern.
In general, it is necessary to build a complete head and shoulders bottom pattern, price movements need to form the bottom of the three low and three local high point, and the location of the three vertices should be the low point is higher than the middle of the left-most The bottom point of the middle of a low lower than other two low, two slightly higher among the low level of location can be a consistent, it can be a slight difference
. Intermediate low is called the head, while the slightly higher lows on both sides of position is called the shoulder.
We usually head and shoulders can be the end of the price movement pattern described as: the price dropped to a relatively low point after the location of A, there has been a turning point rebound in the B point to be suppressed, followed by the formation of stock prices down again, and broke through the front of the support the formation of the A-point (if there is no breakthrough in A points to form a W shape at the end), and create a new low C. After the re-emergence of the price rise, and the D form ascribed to lower point. After trying to launch yet another price drop, but run to the E above the C point point location, multi-buy the amount of support has been difficult to fell again, so stock prices began to run downward trend to change the original form with the original trend in the opposite rise Quotes. Here, the two relatively high B, D is called the connection between the neckline, be pointed out that the head and shoulders bottom pattern in the two high points position does not require the same, in many cases, the right side of a high - click-to-D location of the point will be slightly higher than the B point position.
Finally, the Tongji Science and Technology of the head and shoulders at the end of a perfect shape, its left shoulder and right shoulder position, two relatively high (B point and D point position) were all overlapping, which in reality is not more common in.
Edited in the gold-line
