Inverse Head and Shoulders
Three troughs with the middle one lowest under a near-horizontal neckline; completes on a close above the neckline.
The inverse head and shoulders forms after a decline: a left shoulder low, a lower head, and a right shoulder at roughly the left shoulder's depth. A near-horizontal neckline joins the two rally highs. Kibar ranks the head-and-shoulders bottom among the more reliable classical patterns.
The right-shoulder low is the level that negates the pattern; a failed pattern can reverse sharply.
How we define it
- Swings of at least 2 ATR: left shoulder, peak, head, peak, right shoulder
- Neckline: the two peaks within 3% of each other (near-horizontal), tested at least twice; no close above it before the breakout
- Head clearly below both shoulders; shoulders at 40-85% of the head depth and within 35% of each other; each leg takes at least 10% of the pattern
- Minimum length: 2 months on 1D, 3 months on 1W, 10 days on 4H (from the first boundary test to the breakout or breakdown)
- Breakout (up) / breakdown (down): the first candle close above the upper boundary or below the lower boundary by at least 3% on 1D and 1W (1.5% on 4H), following Edwards & Magee
- Failed breaks: a breakout or breakdown that closes back inside the boundary within 6 candles on 4H, 5 on 1D or 3 on 1W is removed from the list
- Trend filter: breakouts only above the 200-period EMA (40-week EMA on 1W), breakdowns only below it
- Watchlist: the pattern meets the length and test rules, has not broken yet, and price is within 3% (or 1 ATR, at most 6%) of the boundary
No recent breakout or breakdown
No inverse head and shoulders has completed recently. See all patterns.
Nothing on the watchlist
No mature inverse head and shoulders is close to its breakout or breakdown level right now.