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This is distribution/ accumulation patterns. To identify shoulder head shoulder pattern
identify shoulder head and shoulder here head should be the tallest one.
it should take minimum 3 mths.
High volume at lower or 1st shoulder volume should be low on right shoulder that ensures the stronger hand has already moved out create short position if price goes below neckline
H&S is a price pattern showing accumulation and distribution in a short span say 3 months
HERE there are three TOPS of which the middle top is higher than than the left and right tops
VOLUME must be high during the left top indicating the accumulation is going on
Volume will be low during the right top showing the distribution is over
WHEN there are three tops the lowest bottom between them is said to be the neck line
IF the share price moves with volume BELOW the neckline then BEAR trend is startedHead and shoulder is bearish trend . Its strong indication of distribution that’s happening in the market. There should be three peaks formed at a minimum duration of a month for each peak. The middle peak or head should be higher than the shoulders. During the left shoulder the volume traded should be high. We can take short position when it breaks the neck line of head and shoulder.
A pattern where one head with a left and a right shoulder, where the volume is higher at the left shoulder is recognised. A duration of three months. The breakout point of this pattern is where we go short.
head and shoulder pattern is a bearish trend and we can create a short position
conditions :
1. it should take three months to form this pattern
2. and the volume in the left shoulder should be high and the right shoulder should be low then only we determine the head and shoulder
3. short position can be created when it goes below the neck line.
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