Sears Holdings shares hit a Classic 'Head-and-Shoulders Pattern'

Sears Holdings Corporation (NASDAQ:SHLD) shares hit a 'Head-and-Shoulders Pattern' this week and if technical investing tells us anything, it would warrant caution to those holding SHLD shares.
That and cheesy 80's commercials for 'Head and Shoulders' make for an even more enticing analysis.

 
Not everyone believes in charts and let's be honest, these days you have to consider all the data and information before making a decision on buying or selling a given security.  Still, a picture is worth a thousand words and Sears Holdings shares as of today fit a perfect 'head and shoulders' pattern.  So what does that mean exactly and why should you care?

According to Investopedia.com, a Head And Shoulders Pattern is a technical analysis term used to describe a chart formation in which a stock's price:

1. Rises to a peak and subsequently declines.
2. Then, the price rises above the former peak and again declines.
3. And finally, rises again, but not to the second peak, and declines once more.

The first and third peaks are shoulders, and the second peak forms the head.

The "head-and-shoulders" pattern is believed to be one of the most reliable trend-reversal patterns.

Hold up, before we continue, cue cheesy commercial, after all, you're head and shoulders above of the rest:

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SOURCE: http://wallstnation.com/sears-head-shoulders-shld-09302009