KirkLindstrom.com - Charts - 2011 - SOX Semiconductor Index Testing Neckline From Above   
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  Test of SOX Neckline From Above
SOX Philly Semiconductor Index
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June 17, 2011. This chart shows the  SOX Semiconductor Index  testing the neckline of a bullish  inverted Head-and-Shoulders Bottom (Reversal) pattern.   Will this mark the bottom or the start of something worse?

The PHLX Semiconductor Sector (SOX) is a Philadelphia Stock Exchange capitalization-weighted index composed of companies primarily involved in the design, distribution, manufacture, and sale of semiconductors.

Chart

From "Head-and-Shoulders Bottom (Reversal) pattern 
The "Inverted Head and Shoulder Pattern" marks a major trend reversal.  The pattern is made by three successive lows with the center low the lowest and the outside "shoulder" lows higher and ideally equal distrance from the neckline.  The neckline is formed by the hights between the shoulders.  The necline is often tested from above before the pattern takes off which gives conservative traders a second chance to buy the breakout.  
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Note 1: Chart courtesy of stockcharts.com at http://stockcharts.com
 
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