Head & Shoulders Practice
The head and shoulders is the most famous reversal pattern — three peaks with the middle one highest, breaking a neckline. Train to recognise it cleanly instead of seeing it everywhere.
A head and shoulders top has three peaks: a left shoulder, a higher head, and a right shoulder roughly level with the left. A line connecting the two intervening lows is the neckline; a close below it signals the reversal and projects a rough downside target equal to the head-to-neckline height.
How to spot it
- ✓ An uptrend precedes the pattern — it reverses something.
- ✓ Left shoulder, then a higher head, then a right shoulder near the left’s height.
- ✓ Connect the two lows between the peaks to draw the neckline.
- ✓ The signal is a decisive close below the neckline, not the third peak alone.
- ✓ The inverse pattern (three troughs) works the same way as a bottom.
⚠️ Common mistake
Calling the top before the neckline breaks. Three bumps are common in any chart; without the neckline break there is no pattern — only a shape.
Start with a worked example
Decide for yourself first, then open the explanation. The three questions below ask for the same judgement.
Which chart pattern is shown below?
- A Double Top
- B Head & Shoulders
- C Inverse Head & Shoulders
- D Symmetrical Triangle
Show the answer and why
Answer: B. Head & Shoulders
Count the peaks first: there are three, not two, and that alone rules out a double top. Then compare their heights. The middle peak is clearly the highest and the outer two sit at roughly the same level, which is the head with a shoulder on either side. Finally look at the two pullback lows: they land at the same level, and the line joining them is the neckline.
Watch the direction. An inverse head and shoulders is the same structure flipped: three troughs with the middle one lowest. This chart has three peaks, so it is a top and not a bottom. A symmetrical triangle would need the highs stepping down while the lows step up; here the highs go low, high, low and never converge.
One caveat is worth stating. The shape forming is not the same as the shape working. A head and shoulders is only confirmed once price breaks the neckline, and until that break it is indistinguishable from ordinary chop.
Three questions on this pattern
Not three of the same chart — the other options are the patterns this one gets mistaken for.
Which chart pattern is this?
FAQ
Do the shoulders need to be exactly equal?
No. Real patterns are messy — roughly symmetrical shoulders are fine. The neckline break is what confirms it, not perfect geometry.
How is the target estimated?
Measure the vertical distance from the head to the neckline and project it down from the break point. It is a rough guide, not a promise. This page is practice, not advice.