LS - Left Shoulder
RS - Right Shoulder
H - Head of the Shoulder
You can easily visualize, Head-Shoulder pattern and unless market breaks above 8600 area or goes sideways, most likely it will fall back to 8000 level completing the pattern and eventually breaking the neck line.
What does it mean for our Investments?
- Mutual Funds - If still invested in equities then stay invested as market might be turning around. If in cash/ FDs/ liquid funds then the low risk entry was near MA(50), however the risk is elevated and one needs to be ready to pull the plug.
- Stocks - ONLY invest in strong patterns with good earnings guidance and DO NOT forget to have STOP LIMIT on open positions. When market is in correction, it will drag everything down with it. Check out our trade size calculator to manage your risk along with potential buy candidates watch list.
Market trying to turn around yet remain cautious...