Titan - Is this Head and shoulders ???
Updated
Is this head and shoulders? Yes
Is this a good head and shoulders pattern? No
Here are the reasons why one should avoid going short:
1) Premature neckline breakdown in almost 41+ bars. A breakdown in approx 64 bars (or little more) would have been a good one.
2) Volume increases near the head and shoulder peak and decreases near the neckline in case of good pattern. In this case volume increases near the neckline and remains flat near the peaks.
3) Price hugging (re-testing several times) the neckline even after breakdown. Whenever neckline is retested several times it starts getting weak.
I wont be surprised if the neckline is broken upwards and Titan moves towards 875-882 zone.
Conclusion: Avoid taking any position for now. Lets wait for a proper pull back before going short (for a favourable risk reward) or a breakout above 945 before going long.
A counterfeit note is also a note. But one must be judicious and shrewd enough to cherry pick classic patterns and let go the rest.
Suggested reading to know more about classic patterns:
1) Technical Analysis of Stock Trends by Robert D. Edwards and John Magee (Explanation of all the classic chart patterns in detail)
2) Diary of a Professional Commodity Trader by Peter Brandt. (This is must read for traders who have surpassed beginner phase. In this book he has explained both his successful and unsuccessful trades from the past along with the trades that he chose to avoid with proper justification)
Is this a good head and shoulders pattern? No
Here are the reasons why one should avoid going short:
1) Premature neckline breakdown in almost 41+ bars. A breakdown in approx 64 bars (or little more) would have been a good one.
2) Volume increases near the head and shoulder peak and decreases near the neckline in case of good pattern. In this case volume increases near the neckline and remains flat near the peaks.
3) Price hugging (re-testing several times) the neckline even after breakdown. Whenever neckline is retested several times it starts getting weak.
I wont be surprised if the neckline is broken upwards and Titan moves towards 875-882 zone.
Conclusion: Avoid taking any position for now. Lets wait for a proper pull back before going short (for a favourable risk reward) or a breakout above 945 before going long.
A counterfeit note is also a note. But one must be judicious and shrewd enough to cherry pick classic patterns and let go the rest.
Suggested reading to know more about classic patterns:
1) Technical Analysis of Stock Trends by Robert D. Edwards and John Magee (Explanation of all the classic chart patterns in detail)
2) Diary of a Professional Commodity Trader by Peter Brandt. (This is must read for traders who have surpassed beginner phase. In this book he has explained both his successful and unsuccessful trades from the past along with the trades that he chose to avoid with proper justification)
Note
Here are 2 good head and shoulders on Titan hourly chart which met all the necessary condition including symmetry and volume hence gave reliable results.Note
Symmetry in the price swings.Note
Moving towards 875-882 zone as per our analysisNote
Moved towards 875-882 zone as per our analysis on Oct 18
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.