Here’s how I use head and shoulders in daytrading
Yesterday in our Live Day Trading
Room, we got big profits out of a short sell of BRCM, thanks mostly
to a very clear head and shoulders formation followed by a nice, high volume
breakdown.
Notice how the head and shoulder formation consisted of 2 very
clear shoulders and a nicely defined head–a great indication that a reversal is
about to occur.
We shorted at 49.85 during the formation of the 2nd shoulder,
and patiently waited for the breakdown.
(
BRCM |
Quote |
Chart |
News |
PowerRating) did not disappoint, with a
nice high-volume break of the neckline followed by a very fast drop of .50 for
us to cover into.
We exited into the sharp wave, and locked in a 1.2% profit in
the process. Keep your eye out for head and shoulder formations this week,
especially late in the day.
Join me in my Live Trading Room–see my day trading analysis
and get my stock trading alerts in real time.
Andy Swan
Andy Swan created and
co-founded DaytradeTeam five years ago on a principle of empowering
individual stock and options traders with the techniques and analysis methods
typically reserved for elite professionals. His expertise in technical analysis
and commitment to educating members earned DaytradeTeam a top-ranking among
advisory services for several years.