Testing the Neckline of the Inverted Head & Shoulders Pattern
A nice bull surge has taken us to the neckline of the inverted head and shoulders pattern! We pierced it on the last candle..if we can close a couple candles above the neckline I'm fairly confident we will be revisiting the rimline of the inverted cup and handle pattern we broke down from last month. Breaking out from the inverted head and shoulder pattern will also allow us to break upward from the current pink symmetrical triangle we are in as well. However we need to keep an eye on the top trendline of the rising wedge we are still in (in lavender) breaking above this would be a very bullish sign indeed. As with all head and shoulder patterns...wait for the breakout (lots of bullish volume) to decide what to do, as they often times will end up being fakeouts. Good luck in whatever you decide to do, remember this is not financial advice, and thanks for reading!
Comment:
s3.amazonaws.com/tra...shots/u/u6Um93DN.png As you can see we pierced the top trendline of the pink triangle with the wick of the last 4hr candle, which should hopefully weaken it's resistance. We are still stuck inside both that triangle and the lavender rising wedge...I have shifted the breakdown target from the lavender wedge in this image up[ to where the wedge converges with the rimline of the inverted cup and handle (in red) hopefully we don't break down from that wedge until then to prevent us from re entering the pink triangle whenever we break out from it. We may have to bull flag for a little bit here near the top trendline of the symmetrical triangle to reset the 4hr stochrsi and rsi levels to be able to fully break out of the symmetrical triangle...triggering the breakout from the triangle and the inverted head and shoulder pattern should hopefully give us enough momentum to also break up out of the lavender rising wedge as well...but it may not. One very encouraging sign though as we have finally broken well above the 4hr 200MA (in blue) These are all very important things to pay attention to in the next day or 2 to get a good idea of whether or not we will sustain this bull momentum.