I am still a beginner on technical analysis and would appreciate any advice on head and shoulder patterns.
Firstly, the stock is MFS. I have held MFS for nearly 2 years now (and will continue to do so ) but have recently been using CFDs as well. Fundamentally, this will definately be a long term stock for me.
I am quietly confident this stock will be heading upwards soon after about 2 months of consolidation, and am looking to buy some CFDs. However, having read the technical analysis threads on ASF and Incredible Charts, it seems that the recent head and shoulders is a reversal pattern, which makes me not so sure anymore... (charts are attached but haven't yet figured how to annotate and import them from Incredible Charts - sorry!)
Will this reversal pattern definately lead the sp down (as it seems with all diagrams I have seen) or is there a possibility it can 'breakout'? If a downtrend starts from here, is it on the way to the trend line beginning in July 2005 or possibly lower? I remember tech/a saying that 'price action never lies'.