Reverse Head and Shoulders Price/Chart Patterns
At Bottoms Shoulders (H&S) pattern
usually is called an
inverse Head and Shoulders (H&S), a reverse Head
and Shoulders (H&S), or an Head and Shoulders
(H&S) bottom.
N
ormally, volume
is relatively high at the bottom of the left
shoulder and
during the formation of the head. The major
factor to watch for is activity on the right
shoulder, which should contract during the
decline to the trough and expand substantially
on the breakout.
L
ike the Head
and Shoulders (H&S)
distribution patterns, the inverse
(accumulation) Head and Shoulders (H&S) can have a number of
variations in trend line slope, number of
shoulders, and so on. Usually, the more complex
the formation, the greater its significance.
This goes back to the idea that price formations
represent battles between buyers and sellers: the more battles that go
on, the greater the complexity and the more
significant the new trend is once the battle has
been resolved.
H
ead and
Shoulders (H&S) patterns are
extremely reliable formations, and their
successful completion usually gives an
excellent indication of a trend reversal.
Head and Shoulders as Continuation Patterns
Head and
Shoulders (H&S) and reverse
Head and Shoulders (H&S) formations occasionally show up on the
charts as continuation patterns. Measuring
implications and volume characteristics are the
same as for the reversal type. The only
difference is that these patterns develop during a trend rather than at the
end.
price patterns/chart patterns -
Reverse Head and Shoulders Price/Chart Patterns
