What Is Head and Shoulders Pattern?
The Head and Shoulders is one of the most well-known reversal patterns in technical analysis. It forms at the end of an uptrend and consists of three peaks: a left shoulder (smaller peak), a head (higher peak), and a right shoulder (smaller peak roughly equal to the left). The line connecting the troughs between the peaks is called the neckline.
The pattern is considered confirmed when price breaks below the neckline with conviction (volume spike helps). The measured-move target is the height of the head above the neckline, projected down from the breakdown point.
Reverse Head and Shoulders (or Inverse H&S) forms at the end of a downtrend and signals bullish reversal — identical logic flipped.
Reality check: like all chart patterns, H&S works often enough to be useful but fails frequently. Combine with volume and broader market context. False breakdowns are common.
Related terms
- Double Top — A bearish reversal pattern where price tests a resistance level twice and fails.
- Trend — The general direction of price movement over a period — uptrend, downtrend, or sideways.
- Support and Resistance — Price levels where buying or selling pressure historically halts price movement.