What Is The Head And Shoulders Pattern?
when a stock has been gaining in price over a period, being able to sell it at the right time means reaching maximum profit. the completion of a head and shoulders pattern is one indication that a rising stock may be reversing its course. the term, head and shoulders, refers to two smaller peaks in the stock price which look like shoulders with a larger price peak in the middle, the head. analysts draw a so-called neck line from the first ? between the left soulder and the head and the second ? between the head and the right shoulder. the neck line is also called the support because it's the price at which recent sellers have been unwilling to go any lower. the stock of brian's bicycles develops an head and shoulders pattern. a dip below the neck line may indicate a reverse of the stock's upward trend, especially if the downward slope of the right shoulder is accompanied by a large volume of trades. so, what's the best price to buy this stock at after a head and shoulders pattern has formed? many investors take the distance between the top of the head and the neck line and subtract this amount from the neck line to identify a target price. while a head and shoulders pattern is a common tool for identifying a fall of previously rising stock, an upside-down pattern is sometimes used for the opposite reason. in this case, the price moving through the established neck line can indicate that a struggling stock is now gaining. the head and shoulders pattern is used in technical analysis, which is the analysis of chart patterns. taking other measurements into account such as long term moving average will provide added insight into the potential direction of the stock price.
- head and shoulders・・・三尊天井