Brown & Brown, Inc. (NYSE: BRO)

Brown & Brown, Inc., a diversified insurance agency, engages in the marketing and sale of insurance products and services in the United States. Its Retail division provides insurance products and services to commercial, public and quasi-public entity, professional, and individual customers. This division offers property insurance relating to physical damage to property, and resultant interruption of business or extra expense caused by fire, windstorm, or other perils; casualty insurance relating to legal liabilities, workers compensation, and commercial and private passenger automobile coverage. The company's National Programs division offers professional liability and related package insurance products for dentists, lawyers, accountants, optometrists, opticians, insurance agents, financial service representatives, benefit administrators, real estate brokers, real estate title agents, and escrow agents. The company's Wholesale Brokerage division markets and sells excess and surplus commercial insurance products and services to retail insurance agencies. Its Services division offers insurance-related services, including third-party claims administration and comprehensive medical utilization management services for the workers compensation and various liability arenas.

Please take a look at the 1-year chart of BRO (Brown & Brown, Inc.) below with my added notations:




BRO had been moving higher from November until the beginning of July. Since May, the stock has created a very important support level at $25 (red), which was also a key resistance prior to May. That $25 level is the "neckline" support for BRO's head and shoulders (H&S) pattern. Above the "neckline" you will notice the H&S pattern itself (navy). Confirmation of the H&S would occur if the stock broke below its $25 "neckline". If BRO breaks that level, the stock should move lower from there.

Keep in mind that simple is usually better. Had I never pointed out this H&S pattern, one would still think this stock is moving lower simply if it broke below the $25 support level. In short, whether you noticed the pattern or not, the trade would still be the same: On the break below the key $25 level.