tRex88
Education

Titan - Is this Head and shoulders ???

NSE:TITAN   TITAN COMPANY LTD
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)
Comment: 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.

Comment: Symmetry in the price swings.

Comment: Moving towards 875-882 zone as per our analysis
Comment: Moved towards 875-882 zone as per our analysis on Oct 18
Can you please check suntv too!! Same setup in there too
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Hey this was really helpful, could you pls comment on why this inverse H&S failed>???
+1 Reply
tRex88 Nikita_Poojary
@Nikita_Poojary, I dont consider that as a head and shoulders as
1) the neckline you drawn is not well defined and clear in my opinion (This could be subjective)
2) Head and Shoulders and Inverted H&S are reversal patterns and not continuation patters. So you should be looking for an inv H&S pattern only after a downtrend and Biocon on day chart is not in a downtrend.
3) Volume at the left shoulders (since you call it inv H&S) is not peaking at the left shoulders bottom.
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@tRex88, appreciate ur quick revert on this.... Inverted H&S is formed in the downtrend for biocon (basis daily charts, post june 5)..
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tRex88 Nikita_Poojary
@Nikita_Poojary, I disagree... Biocon after forming a top went sideways... It never went into downtrend as of now.

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@tRex88, Hey I agree.... makes sense...it went sideways and didn't went into downtrend.. thanks for your help!
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I had already taken a short position basis this H&S ..was wondering why the hell it was not respecting.... seems time to square it off.. Thanks for the detailed explanation.
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WOW , i have been coming back to this chart everytime i get confuse with H&S pattern .
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Sir I see a buy............... Mark my words it will go up.... bullish on titan bcoz it is in weekly support of the buyers... foolish peoples keep selling...right now people may call me over confident,,,, after the trade goes back up u will call be great.....
+3 Reply
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