The S&P 500 is on the verge of breaking a head and shoulder neck line. A head and shoulder pattern is an extremely bearish setup in a stock chart. When found, it can make you significant amounts of money if you know how to trade it. The play this pattern, you want to see a clearly defined head and shoulder pattern like that shown in the chart below. Next, connect the two low pivots making up the shoulders on either side of the head. The line must always be flat or up-sloping. When price breaks that neck line, look for a sharp fall on the stock chart. In the case of the S&P 500 or in the chart the tracking ETF $SPY, price is getting near the neck line break. If it breaks, the markets are destined to fall to $214.20 from their current $216.15 level.

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Jenny Rebekka