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Tagged: INVERTED HEAD AND SHOULDER
An inverted Head and shoulder is the reverse of normal head and shoulder.
to determine the bullish trend it should fulfill the following conditions,
The volume should be high at the left shoulder zone.
The volume should be the lowest at the right shoulder zone.
The whole pattern should 3-4 months.
If it breaks the neckline then it can be said as the start of bullish trend.
There will 2 shoulders and 1 head.
Left shoulder the buyer and seller will fighting at high volume than Right shouder.
Header, the seller will go for aggressive selling and the buyer with low volume.
Duration – 3 months.
Bullish trend starts, when the Right shoulder Breakout point occurs.
This is a reciprocal of a head and shoulder, hence an inverted head and shoulder .
Conditions to determine a bullish trend:
if the above conditions are met, then long position can be created when the price crosses the top neck line.
The reciprocal image formation of a head & shoulder is inverted head & shoulder.
Formation of the head should be the highest
Duration of shoulder-head-shoulder should be minimum 3 months.
volume during the left shoulder should be high
volume during the right shoulder should be the lowest to understand that stronger hand has left the market
Long position to be created when price breaks the previous top of right shoulder
There is a correction in point #3. It should be
3. Left shoulder must have significant volume and right shoulder should have less volume.
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