Chart of the Week: Nasdaq Head & Shoulders Formation?

All the major indices appear to be on the verge of tracing out a major continuation pattern: The Head & Shoulders. While often thought of as a reversal pattern at tops or bottoms, H&S is also a continuation pattern.

Nasdaq (1 year chart) Head & Shoulders Formation?
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What's been said:

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  1. Yasser commented on Jul 24

    IMHO, that isn’t a head and shoulders. The right shoulder dips to the same level as the head, invalidating the pattern.

    Besides, given that this is the third test of roughly the same level (i.e., 1870-1900), a sustained bounce should be less likely because the pool of potential buyers was depleted in the last two tests of that zone. The more tests of a particular support level, the less likely it will hold…

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