Below is a slider quiz to test your ability to identify complex head-and-shoulders tops. Captions appear below the pictures in red for guidance, so be sure to scroll down far enough to read them.
1 / 7
Shown is an example of a complex head-and-shoulders top (cHST). This one has a left shoulder (L), dual head (H), and right shoulder (R). A neckline (shown in red) slopes
downward. In such a situation, use a horizontal line connecting the lowest armpit on the right side of the head (shown here as a green line), as the neckline. Why? Because if the neckline
is too steep, price may never close below it. When price closes below the
neckline, it validates the pattern as a good one and signals a breakout. In many cHSTs, you'll see horizontal or near-horizontal necklines. Volume is typically higher on the left shoulders
than on the right ones. Complex head-and-shoulders can have many heads and many shoulders, but usually have one or the other (many heads or many shoulders, but not both).
2 / 7
Find a bad example of a complex head-and-shoulders top. For help, click here.
3 / 7
This cHST has many shoulders but only one head. Notice that the shoulders on the left mirror the ones on the right in distance and price (most of the time). The shape
of this one looks more like a rounding top, than a cHST.
4 / 7
Find as many cHSTs as you can and a diamond top. This is a composite chart of Go Pro stock (meaning I took two pics and combined into one).
5 / 7
The left complex head-and-shoulders top is a good example what one should look like. This has a dual head. The other cHST is probably better called a diamond top because of
6 / 7
Let's try one more. Find as many cHSTs as you can and find a triple top, too.
7 / 7
The triple top is the three Ts on the left. The cHST is a dual head variety.