Hello Traders,
I guess am seeing ADA forming a head and shoulders pattern..
It may test the neck line soon at 0.6304.
In case of a break : I guess 0.6000 will be the first major support that the price can retrace from instead of going to the H&S target.
INVALIDATION : Dotted line ( above 6.53 )
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Educational :
What is Head and shoulders pattern ?
The Head and Shoulders pattern is an accurate reversal pattern that can be used to enter a bearish position after a bullish trend. It consists of 3 tops with a higher high in the middle, called the head. The line connecting the 2 valleys is the neckline. The height of the last top can be higher than the first, but not higher than the head. In other words, the price tried to make a higher high, but failed. The closer the 2 outer tops are to the same price, the more accurate the pattern.
If the price breaks the neckline and closes below it, the pattern has completed. Conservative traders may look for additional confirmation. The target can be estimated by measuring the height of the pattern (from the neckline to the head) and projecting this downwards. Common stop levels are above the neckline or above the right shoulder. The Inverse Head and Shoulders is the bullish version of this pattern that can form after a downtrend. TradingView has a smart drawing tool that allows users to visually identify this pattern on a chart.
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Have a nice day.
I guess am seeing ADA forming a head and shoulders pattern..
It may test the neck line soon at 0.6304.
In case of a break : I guess 0.6000 will be the first major support that the price can retrace from instead of going to the H&S target.
INVALIDATION : Dotted line ( above 6.53 )
-
Educational :
What is Head and shoulders pattern ?
The Head and Shoulders pattern is an accurate reversal pattern that can be used to enter a bearish position after a bullish trend. It consists of 3 tops with a higher high in the middle, called the head. The line connecting the 2 valleys is the neckline. The height of the last top can be higher than the first, but not higher than the head. In other words, the price tried to make a higher high, but failed. The closer the 2 outer tops are to the same price, the more accurate the pattern.
If the price breaks the neckline and closes below it, the pattern has completed. Conservative traders may look for additional confirmation. The target can be estimated by measuring the height of the pattern (from the neckline to the head) and projecting this downwards. Common stop levels are above the neckline or above the right shoulder. The Inverse Head and Shoulders is the bullish version of this pattern that can form after a downtrend. TradingView has a smart drawing tool that allows users to visually identify this pattern on a chart.
-
Leave a thumb up if you agree !
Follow for more <3
Have a nice day.
코멘트:
Valid until we have a close with candle body above right shoulder.
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