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Head and Shoulders

Short Volatility during rare spikes using leveraged ETF $UVXYOverview Volatility represents how greatly an asset’s prices swing around the mean price. Historically there are rarely brief volatility flare-ups that present trading opportunities. Trying to anticipate volatile events can be costly, because other market participants generally expect the same well known events, and one never knows how big a volatility spike might arise from a given event. Instead if one merely awaits extreme volatility events, which historically are ephemeral, there's a higher probability trade in shorting it. I've thought about this previously, and took the opportunity with Liberation Day to successfully short volatility. Volatility Instrument Selection Choosing an appropriate instrument can aid in the likelihood of a successful short position. Among the options CBOE:UVXY looks attractive for the trade, because it's a leveraged ETF, is highly liquid, and provides options with granular strike prices and expiration dates. Leveraged ETFs are known to decline over time due to Daily rebalancing and compounding effects Volatility drag Cost of leverage Management fees and expenses Path dependency These characteristics of leveraged ETFs provide a structural tailwind to a short position, because the instrument naturally declines over time. This phenomenon easy enough to see on a CBOE:UVXY weekly chart Moreover selection of a liquid product is prudent. At the time of writing CBOE:UVXY has an average daily volume north of $22 million dollars for the past 30 days. Trade execution Execution of the trade starts with recognition of a highly volatile event, this is both technical and discretionary. From there a trader is advised to use their preferred tactics to select entry, stop-loss and exit points. Personally I like to use chart patterns across different timeframes in tandem with Relative Strength Index, and to a lesser extent volume to identify trading setups. I use longer term charts to identify a trend, and shorter timeframe charts to determine entry and exit points. The timeframe(s) depend on the particular instrument and what the charts look like at the time of the trade. During the Liberation Day Volatility Short trade, I've been using 1W, 1D, 4H and 1H charts. The 1H chart has been suitable for entering an exiting trades. Head & Shoulders patterns have manifested both on price and momentum alongside declining volume. I've posted a couple CBOE:UVXY minds along the way. Additional Thoughts Volatility can also be used generally to anticipate moves in other asset classes, such as stocks, bonds, crypto and commodities. Using the levels from that last chart fed into successful NASDAQ:TQQQ & NASDAQ:SQQQ trades in the aftermath of Liberation Day.
CBOE:UVXYShort
by quickshiftinn
Crude Oil Price Action & Pattern Analysis Bearish Wedge Breakdown: The price was consolidating in a descending triangle / wedge pattern. It has now broken below the wedge, suggesting potential bearish continuation. Key Support Zones: Immediate support near 68.60 - 68.80 (highlighted in blue). FOREXCOM:USOIL The break of the 68.60 level with a strong bearish candle would serve as confirmation of a Head and Shoulders (H&S) pattern , with solid bearish implications. Stronger support around 66.20 - 66.50 , which is a previous demand zone. Resistance Zone: The red zone around 69.40 - 69.50 represents a rejection area , and the price failed to break above it.
TVC:USOILShort
by SaklainManzoor
Loss of Momentum Pattern Into StructureSimilar to the OANDA:GBPJPY that I shared, the OANDA:EURAUD has put in a pretty aggressive and direct move into a previous level of structure. However, what makes this opportunity different than "the beast" is that as price approach our level of resistance we started to put in a rising channel which is a loss of momentum pattern along with other clues such as divergence on the RSI. If you have any questions, comments or want to share your views, please do so below. Also be sure to hit that like button & give me a follow, that way you don't miss my future trading ideas. Akil
Short
by Akil_Stokes
BITCOIN 15-Min Chart – Key Support Retest with Bullish PotentialThis 15-minute BTCUSD chart shows Bitcoin retesting a strong support zone near $112,680 after a clear downward move. The price is currently reacting at a previous demand area, marked in blue, just above the session’s LOW. A possible bullish reversal setup is forming if the support holds, targeting the previous HIGH around $114,000 and a potential TP at $114,200. Traders may look for confirmation signals (e.g., bullish engulfing, order block reaction) before entering long positions.
BITSTAMP:BTCUSDLong
by mcflaryjr
USD Turns GBP On Its "Head"FX:GBPUSD has formed a Head & Shoulders Pattern! Price has already broken down below the "Neckline" to Confirm that Pattern. Currently, Price is working its way back up to retest the Breakout and if the level is strong enough and holds, we could see Price follow through with its reversal to lower prices! If the retest is successful, the May 12th Lows of 1.31741 - 1.31394 could be a good Support level to set as a Price Target. Now we wait for a Retest!
Short
by Novi_Fibonacci
11
Bull Trap Confirmed: GBPUSD's 8% Rally Faces ExhaustionLets Face it we had a great 6 months already clocking 60%+ Returns already. And after sitting ducks for almost 2 months now we finally have a trade. - Its a very self explanatory chart - Trading at resistance - Head & Shoulder pattern And the best part the right shoulder is still yet to be formed! My favourite type of entry. 1.It gives a better risk reward ratio (1:7 expected) 2.Better Entry (No long red candles) 3. And even if the pattern fails it we may still reach the neck line which is target 1. Entry Criteria - A Red candle at the entry Line Marked - Stoploss Above the Entry Candle Target 1- 1.3361 Target 2- 1.3252 Target 3- 1.3169 Keep Your Risk Reward Intact! Not An investment Advice
Short
by REUBEN_EUSTACE
#BTCUSDT – Healthy Correction, Not the End!Bitcoin is currently experiencing a healthy pullback after an impressive run, testing the neckline of the Inverse Head & Shoulders breakout on the 1D timeframe. 🔹 Current Market View: BTC is retesting the neckline of the IHS pattern, which now acts as a strong support zone. Price is holding near $113K–$115K, which is crucial for maintaining bullish momentum. This dip is a healthy correction, flushing out over-leveraged positions and preparing for the next leg up. 🔹 Key Levels: Support Zone: $113,000 – $115,000 Immediate Resistance: $120,000 – $122,500 Breakout Target: $165,000+ on the next bullish wave 🔹 Market Sentiment: Holding above the neckline keeps the bullish structure intact. If the support holds, we can expect continuation to new highs once buying pressure returns. A daily close below $112K would signal caution and delay the next rally. 💡 Tip: Don’t panic on these red candles. Healthy corrections are part of a sustainable uptrend.
Long
by CoreCrypto1