Head and Shoulders Pattern

HEAD

RIGHT SHOULDER

RIGHT SHOULDER

The head and shoulders pattern is a bearish pattern. First the stock rallies and pulls back to form the left shoulder. Since most of the public buy stocks near the top, the lemmings step in and start buying the stock. This causes the top of the pattern at the head. The big players start to sell, which causes the stock to pull back to the neck line. More lemmings (public) buy even more, but the smart money sells into this last push to form the right shoulder, which cannot push the stock's price as high as the first left shoulder.

Beghnhg of Ihe head end shoiideis pattern.

102 / Secret Trends and Patterns StockTeacher Method

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