🙎‍♂️Head & Shoulders

Reversal pattern

Head and shoulders is a reversal pattern that can appear at market tops or bottoms as a series of three pushes: an initial peak or trough, followed by a second and larger one, and then a third push that mimics the first.

An uptrend interrupted by a head and shoulders top pattern may experience a trend reversal, resulting in a downtrend. Conversely, a downtrend that results in a head and shoulders bottom (or an inverse head and shoulders) will likely experience a trend reversal to the upside.

Horizontal or slightly sloped trendlines can be drawn connecting the peaks and troughs between the head and shoulders, as shown in the figure below. Volume may decline as the pattern develops and spring back once the price breaks above (in the case of a head and shoulders bottom) or below (in the case of a head and shoulders top) the trendline.

Inverse Head & Shoulders