Trading Idea - #DAX

Trading Idea - #DAX
Sell/Short after head and shoulders pattern forms!

Entry: 15.290 (the neck line)
Target: 14.937 (the head height)

1. the initial rally into the pattern is often associated with a strong rise.

2. the first shoulder forms where price peaks before falling back to a support level - the neckline.

3. once the market reaches the neckline, it rallies to make a higher high before pulling back to the neckline.

4. the market then bounces off the neckline again, this time making a lower high than the previous bounce off the neckline.

5. the pattern is only confirmed when the sell-off from the second shoulder breaks below the neckline, after which the target equals the distance between the neckline and the top of the "head".


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