Head & Shoulders — the Classic Top

The three peaks

Left shoulder: rally peaks, pulls back. Head: higher peak (new high), deeper pullback. Right shoulder: LOWER peak that fails before the head — the tell that buyers are weakening. The neckline connects the two pullback lows; the pattern completes when price CLOSES below the neckline on expanding volume.

Measured move & the failed pattern

Classic target: head-to-neckline distance projected down from the breakdown. Inverse H&S at bottoms mirrors it. And crucially: H&S fails often — a right shoulder that keeps rising, or a neckline break that snaps back (throw-over/throw-back), kills it. The neckline break with volume is the trade trigger; everything before is anticipation.

Symmetry discipline

Shoulders should be roughly symmetric in height and spacing. A "head and shoulders" with a right shoulder towering over the left is just an uptrend. Don't force the pattern onto noise — Bulkowski's rule: if you have to squint, it isn't there.

Sources

• Head and Shoulders PatternInvestopedia
• Technical Analysis of the Financial MarketsJohn Murphy