DJI : Head and Shoulder pattern is building

maneeshaggarwal Updated   
TVC:DJI   Dow Jones Industrial Average Index
For educational purpose
A head and shoulders pattern has four components:

1. After long bullish trends, the price rises to a peak and subsequently declines to form a trough.

2. The price rises again to form a second high substantially above the initial peak and declines again.

3. The price rises a third time, but only to the first peak level, before declining again.
The neckline, drawn at the two troughs or peaks (inverse)

4. After breakdown the neckline with strong volume is the right sign of trend reversal for time duration in which this H&S pattern is building.

5. Check RSI in 1st Peak makes a high, but in 2nd makes lower high, in 3rd another lower high will confirm the trend is not in position sustain it's momentum.

Minimum target of this pattern is the distance between the neckline point to highest point of the Head (Peak) in a straight line in no. of points. the same point will be deducted from the point where this neckline breaks to downward.

DJI is in process of making Head & Shoulder Pattern in HOURLY timeframe

If DJI Break Down Below 38110 then it may touch below levels
Level 1 37650
Level 2 37150
All above assumptions goes wrong If DJI closes above 38555 then a very fast upside will be witnessed double upside.

DJI is showing Convergence IN RSI so it means very likely it may touch aforesaid levels

Disclaimer:- Please always do your own analysis or consult with your financial advisor before taking any kind of trades.

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Trade closed: stop reached


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