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1. What is the Head and Shoulders pattern?

- A reversal pattern indicating a potential change in direction from bullish to bearish.

- It consists of three peaks:

- Left shoulder: first peak followed by a decline.

- Head: a peak higher than the shoulders followed by a decline.

- Right shoulder: a third peak lower than the head.

- The pattern is completed by breaking the Neckline, confirming the bearish signal.

2. How to trade based on the pattern:

- Enter a sell trade after breaking the Neckline.

- Price target: usually calculated by the distance from the head to the Neckline, then subtracted from the breakout point.

- Stop loss: placed above the right shoulder or head depending on the trader's strategy.

- The pattern is not 100% guaranteed, so it's preferable to use it with other indicators like RSI or MACD.

- The pattern may appear inverted (Inverse Head & Shoulders), indicating a bullish reversal.

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