Inverse Head and Shoulders
An inverse head and shoulders is a bullish reversal pattern that forms at market bottoms. It's the upside-down version of head and shoulders: left shoulder (low), head (lower low), right shoulder (higher low), then breakout above the neckline.
Understanding the Concept
This is one of the most reliable bottom reversal patterns. It shows sellers making a final push (the head) but failing to maintain control. The right shoulder's higher low confirms buyers are stepping in. The neckline breakout is your entry signal. Volume should be highest on the right shoulder and breakout—that shows real demand. Target is the pattern's height added to the neckline. Failed patterns happen, so always use a stop below the right shoulder.
Real-World Example
Ethereum bottoms at $1,000 (left shoulder), drops to $800 (head), bounces to $1,100 (neckline), dips to $950 (right shoulder), then breaks above $1,100. Target: $1,400 ($300 height added to neckline).
How Strykr Helps
Strykr's AI monitors Inverse Head and Shoulders signals across 5,000+ assets in real-time. Get instant alerts when significant patterns emerge, with context about market conditions and confluence factors.
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