Reversal patterns
Inverse head and shoulders
Usually bullish
The mirror image of head and shoulders: a low (the head) flanked by two higher lows, with the highs between them forming a neckline.
What a inverse head and shoulders tells you
It marks the end of a sequence of lower lows. Sellers could not push price back to the head on the second attempt, and the break above the neckline confirms that buyers have taken control of the structure.
Why it forms
Each sell-off finds buyers earlier than the last. Shorts who added at the right shoulder are squeezed on the neckline break.
How traders enter it
Entry is usually on a close above the neckline or on the retest from above. The measured objective is the head-to-neckline distance projected up.
How it fails
Frequently fails in a downtrend that has not exhausted itself: the neckline break stalls at the next overhead supply shelf and price rolls over.
That last section is the one worth rereading. A pattern is only useful because it comes with a level that proves you wrong — without one you have a shape and a hope.
People also ask
Is a inverse head and shoulders bullish or bearish?
A inverse head and shoulders is usually read as bullish, but only once it confirms. Before the confirming break it is a shape, and shapes fail. Context decides more than the label does.
How do you trade a inverse head and shoulders?
Entry is usually on a close above the neckline or on the retest from above. The measured objective is the head-to-neckline distance projected up.
When does a inverse head and shoulders fail?
Frequently fails in a downtrend that has not exhausted itself: the neckline break stalls at the next overhead supply shelf and price rolls over.
Can ChartLens spot a inverse head and shoulders for me?
Yes. Photograph or screenshot any chart and ChartLens names the pattern if it is clearly formed, with a confidence level and whether it is forming, confirmed or failed — and says nothing if it is not there.
Last updated .