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Thomas Bulkowski’s successful investment activities allowed him to retire at age 36. He is an internationally known author and trader with 30+ years of stock market experience and widely regarded as a leading expert on chart patterns. He may be reached at

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Chart Patterns: After the Buy
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Bulkowski's Complex Head-and-Shoulders Bottom

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Candles Chart
Small Patterns
Industrials (^DJI):
Transports (^DJT):
Utilities (^DJU):
Nasdaq (^IXIC):
S&P500 (^GSPC):
As of 10/19/2018
25,444 64.89 0.3%
10,439 34.57 0.3%
746 11.47 1.6%
7,449 -36.11 -0.5%
2,768 -1.00 0.0%
Tom's Targets    Overview: 10/11/2018
26,000 or 24,600 by 11/01/2018
10,200 or 11,100 by 11/01/2018
755 or 715 by 11/01/2018
7,700 or 7,200 by 11/01/2018
2,850 or 2,700 by 11/01/2018

Written by and copyright © 2005-2018 by Thomas N. Bulkowski. All rights reserved. Disclaimer: You alone are responsible for your investment decisions. See Privacy/Disclaimer for more information. Some pattern names are the registered trademarks of their respective owners.

For more information on this pattern, read Encyclopedia of Chart Patterns Second EditionEncyclopedia of Chart Patterns 2nd Edition book., pictured on the right, pages 390 to 404. That chapter gives a complete review of the chart pattern, compared to what is described below.

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A complex head-and-shoulders bottom is a chart pattern that looks like an inverted head-and-shoulders but with multiple heads, multiple shoulders, or sometimes both. The break even failure rate is low and the performance is good from this chart pattern.

A complex head-and-shoulders bottom appears

Complex Head-and-Shoulders Bottom

Important Bull Market Results for Complex Head-and-Shoulders Bottom

Overall performance rank (1 is best): 9 out of 23
Break even failure rate: 4%
Average rise: 39%
Throwback rate: 63%
Percentage meeting price target: 74%

The above numbers are based on hundreds of perfect trades. See the glossary for definitions.

Complex Head-and-Shoulders Bottom Identification Guidelines

Price trendDownward leading to the pattern.
ShapeA head-and-shoulders bottom with multiple shoulders or multiple heads but rarely both.
SymmetryThe shoulders should bottom near the same price, be nearly the same distance from the head, and look similar to their mirror opposite.
Volume trendUsually higher on the left side of the pattern. Trends downward 65% of the time. The link to the left gives an example and this link discusses performance.
NecklineJoins the highest armpits.
ConfirmationThe pattern confirms as a valid one when price closes above a down-sloping trendline or above the right armpit when the neckline slopes upward.
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Complex Head-and-Shoulders Bottom Trading Tips

Consult the associated figure on the right.

Trading TacticExplanation
Measure ruleCompute the height from the head low (A) to the neckline (B) directly above then multiply it by the “percentage meeting price target (see above "Important Bull Market Results"). ” Add the result to the breakout price (C). The breakout price is where price crosses a down-sloping neckline, or when the neckline slopes upward, use the peak of the right shoulder armpit. The figure to the right shows an example for a regular head-and-shoulders bottom.
Price reversalPrice must have something to reverse, so if the decline leading to the pattern is small, expect a small rise.
ConfirmationWait for confirmation (breakout) before placing a trade.
TrendsAn intermediate-term (3 to 6 months) drop leading to the pattern results in the best post breakout performance.
NecklinePatterns with down-sloping necklines perform better. The green neckline on the chart to the upper right shows an example (Measure Rule figure).
ShoulderThe best performance associated with patterns having even shoulder valleys (comparing the two outermost shoulders only). The red arrows point to the shoulders in the figure to the right.
Yearly middlePatterns having breakouts in the middle third of the yearly price range perform best.
Volume trendAn upward volume trend suggests better post breakout performance.
ThrowbacksThrowbacks hurt post breakout performance as the study discusses.
SymmetryPatterns with an extended right shoulder perform worse. Symmetrical looking patterns also perform better.

Head-and-shoulders chart pattern measure rule

The Measure Rule

Head-and-shoulders chart pattern with even shoulders

Even Outer Shoulders

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Complex Head-and-Shoulders Bottom Example

Complex head-and-shoulders chart pattern example

The above figure shows an example of a complex head-and-shoulders bottom chart pattern. This complex head-and-shoulders has a dual head. Additional shoulders too far away to really be part of the chart pattern are located at A and B.

Price breaks out in August but quickly throws back. A throwback occurs 63% of the time in a bull market.

-- Thomas Bulkowski

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Other Complex Head-and-Shoulders Bottom Examples

See Also

Written by and copyright © 2005-2018 by Thomas N. Bulkowski. All rights reserved. Disclaimer: You alone are responsible for your investment decisions. See Privacy/Disclaimer for more information. Some pattern names are the registered trademarks of their respective owners. You're not bothering me. It's way beyond that.