Head & Shoulders Failure by Kenny Gilliland
ARTICLE SYNOPSIS ...Head & Shoulders Failure by Kenny Gilliland
How can you effectively trade one of the most recognizable chart patterns?
Imagine this scenario: You are reviewing the charts of stocks that recently declined when a pattern jumps out at you from the screen -- a head & shoulders formation. You place a stop market order to sell the stock short once the neckline is pierced. The order is ultimately filled and you wait for the stock to head south. At first, it declines slightly and then begins to move sideways for a week before heading up and back through the neckline. Luckily, you placed a stop order ...