Head & Shoulder pattern

It shows end of bullish price

It shows reversal coming your way

Head

Shoulder

Neckline/
Resistance

Inverse Head and shoulder

Paremeters for a Head & SHoukders

1. Base line difference: -

The distance b/w base of shoulder and peak of shoulder(b) and distance b/w peak of
the head and peak of shoulder(a)
Ratio of a/b should be greater than 1.5

We can see 1&2 doesn’t have a great difference in head and shoulder but 3 has a
great head, therefore 1&2 are deceptive mirage

2. Angle of incline: -
a. A graph’s Clavical is going upwards but at a lower angle
b. A graph is going upwards at a sharper angle
c. A graph is going downwards at a moderate angle
d. A graph going downwards at a sharper angle
3. No of heads and shoulders
a. If no of head is more than 1, it is a deceptive mirage
b. If no of shoulders are greater than 1 towards right, it a good sign but if there are
more than 1 on the left side, it is a bad sign