As a turning point between an upward trend and a downward trend, the top of the head and shoulders is a relatively reliable downward signal. Understanding the formation pattern, morphological characteristics, and corresponding buying and selling strategies of the head, shoulders, and bottoms can not only seize important short selling opportunities, but also, in the opposite case, seize clear bullish opportunities based on the upward signal of the head, shoulders, and bottoms.
The so-called head and shoulder tops are formed in this way: following the previous stage's upward trend, the trend rises toAPoint begins to fall back; fall toBThe point is able to stand firm; Another round of upward momentum, surpassingAPoint at the price point, in order toCPoint at the top of the rising wave, then fall back and slide to the point where it is related toBAt a similar level, atDStop and then turn back upwards, rising to the same level asAA price range with little difference in pointsEStop and then turn around and plummet, when it breaks throughBAndD两个低点拉成的颈线,整个下跌趋势就形成了。这样一幅图形,三个高点,中间最高,恰似一个人的头,两侧较低,好比两个肩膀,所以按形象称为“头肩顶”。第一,头肩顶是在升势中产生的。当右肩未出现时,光看左肩和头,却是“一浪高一浪”的涨势。即使在左肩买入,到头顶的价位,仍是形势大好;第二,从头顶回落,掉头再上,至与左肩相近的价位后再急转直下,右肩就成形了。这时,在一头两肩区域买入的合约变得无利可图巨出现浮动损失;第三,走势跌破颈线时,因为整个头肩顶是以颈线为底的,破了颈线,头肩顶区域的所有多头台约均被一网打尽,无一幸免。