head and shoulders
/hɛd ənd ˈʃoʊldərz/
a chart pattern with three peaks — a higher middle peak flanked by two lower ones — signaling a trend reversal
head and shoulders in a sentence
“The head and shoulders pattern formed over six months, warning of the major decline ahead.”
Origin of head and shoulders
Named for its visual resemblance to a human silhouette
Related Words
RSI
relative strength index — a momentum oscillator measuring the speed and magnitude of recent price changes, scaled 0 to 100
MACD
moving average convergence divergence — a trend-following momentum indicator showing the relationship between two moving averages
Fibonacci retracement
horizontal lines on a chart at key Fibonacci ratios indicating where support or resistance may occur
overbought
describes a security that has risen sharply and may be due for a price correction
volume
the total number of shares or contracts traded for a security during a given period
support level
a price point where buying interest is strong enough to prevent further decline