Head and shoulders pattern. Forex trading.
Independent, which time unit, is applied price movement Forex charts form different kinds of periodically repeating equal patterns. Some of those patterns always occur on charts before the trend reversal when the volume is significantly decreasing or increasing. Such formations known as reversal patterns are considered below.The Head and shoulders pattern is one of the most reliable and well known chart formations. It consists of three consecutive rallies. The first and third rallies—the shoulders—have about the same height, and the middle one—the head—are the highest. All three rallies are based on the same support line (or on the resistance line in the case of the reversed Head and shoulders formation), known as the neckline.







