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How to identify a head & shoulders pattern with an indicator

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This technique can be used on the Donchian channel (above), Keltner , or Bollinger bands .

1) Trending phase where price "walks" one side of the channel
2) Retest of the opposite side of the channel. If you like oscillators, they'll show a new momentum high here.
3) Failure to make new extremes in the trend direction
4) Enter on a cross of the basis (mid point of the channel) or re-touch of the channel. If you like oscillators, they'll give you a crossover entry here.

The difficulty is in #3, the right shoulder. This is a deep shoulder. Oftentimes, price doesn't move past the basis before retesting the channel wall.
Not
Trade is almost complete. It's now a clear head and shoulders pattern that we were able to identify mechanically. Mechanical identification saves a lot of time and energy.
İşlem kapandı: hedefe ulaştı

Feragatname

Bilgiler ve yayınlar, TradingView tarafından sağlanan veya onaylanan finansal, yatırım, işlem veya diğer türden tavsiye veya tavsiyeler anlamına gelmez ve teşkil etmez. Kullanım Şartları'nda daha fazlasını okuyun.