Here is a sloppy head and shoulders formation that I entered into yesterday. I entered this trade at 86.77 based on a weekly overhead resistance area. After the move lower today I decided to add to my short since it starting to look like a bearish head and shoulders formation is forming. There are two options in this YEN setup. One option is to take my profits at the trend line, and the other option is to wait for the head and shoulders formation setup to break and then stay short with the text-book like measured move target at 85.11 area.
I promise to post some better examples of the forex head and shoulders formation in the future as we see a few at the moment forming on higher timeframes.
Image below of the audjpy trendline drawn on the daily chart. Notice we still have some room before we touch this trendline. I feel this is a good area to take profits.
- Posted by fx_Trader
- On July 5, 2017
- 0 Comments