Three proper inverse head and shoulders patterns!

Today, we do have three interesting occasions with one pattern – inverse head and shoulders. First, one can be currently seen on Gold. We already managed to break the neckline, which triggers us a buy signal. The thing is, that this signal is very close to being denied as we are falling below the neckline again. A false breakout can be a strong sell signal!

The second pattern can be seen on the Cable but here, we are still below the neckline so the trading signal has not been triggered yet. Midday brings us a strength of the USD so the breakout of the neckline becomes less probable. The signal to go long will be triggered when the price will break the blue resistance.

The last one is the NZDUSD, where we already broke the neckline but the price is going down, so the situation is similar to this one seen on Gold. In my opinion, for the proper buy signal, we have to wait until the breakout of the orange horizontal resistance.

This article is written by Tomasz Wisniewski, a senior analyst at Alpari Research & Analysis