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Structure of a Head and Shoulders Pattern

The Head and Shoulders pattern has three peaks: a higher middle peak (the head) between two lower and roughly equal peaks (the shoulders). It signals a potential trend reversal from bullish to bearish when the price breaks below the "neckline," which connects the lows between the shoulders and the head.

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Structure of a Head and Shoulders Pattern

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  1. Structure of a Head and Shoulders Pattern For more Visit: https://navia.co.in/blog/understanding-head-and-shoulders-chart-pattern/

  2. Introduction to the Head and Shoulders Pattern ● A reversal pattern signaling a potential trend change from bullish to bearish. ● Commonly used by traders to identify market tops and predict downward movements. For more Visit: https://navia.co.in/blog/understanding-head-and-shoulders-chart-pattern/

  3. The Left Shoulder ● Price rises to a peak, then declines to form a trough. ● This is the first high, setting up the structure. For more Visit: https://navia.co.in/blog/understanding-head-and-shoulders-chart-pattern/

  4. Head and Right Shoulder ● Head: Price rises again, forming a higher peak than the left shoulder, then falls. ● Right Shoulder: Price rises again, but forms a lower peak than the head, followed by a decline. For more Visit: https://navia.co.in/blog/understanding-head-and-shoulders-chart-pattern/

  5. The Neckline and Breakout ● Neckline: Drawn through the troughs between the peaks. ● Acts as a support level. ● Break below the neckline confirms the pattern → signals a bearish reversal. For more Visit: https://navia.co.in/blog/understanding-head-and-shoulders-chart-pattern/

  6. Disclaimer Investment in securities market are subject to market risks, read all the related documents carefully before investing. The securities quoted are for illustrative purposes and are not intended as recommendations. Brokerage will not exceed the SEBI prescribed limit. Navia Markets Ltd ,SEBI Registration No.INZ000095034-NSE Member code for CM, FAO & CD: 07708 - BSE Clearing No. for CM, FAO & CD: 6341-MCX Member ID: 45345 NSDL DP ID: IN300378-CDSL DP ID: 12086500-SEBI Registration No. for DP: IN-DP-311-2017-GST Registration number :33AAACM4739R2ZZ-Registered office: Ganga Griha, 4th & 5th Floor, No.9, Nungambakkam High Road, Chennai - 600 034 Email ID: ig@navia.co.in - Contact No: +91 70100 75500 https://bit.ly/naviadisclaimer For more Visit: https://navia.co.in/blog/understanding-head-and-shoulders-chart-pattern/

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