ABSTRACT
A formation of the Head-and-Shoulders type may develop at an important Reversal of Trend from down to up. The volume pattern is somewhat the same as at a Top but with some important changes in the latter half of the formation. A low-volume breakout from a Bottom Pattern may only be premature, to be followed after more "work" around the Bottom levels by a genuine advance, or it may be a "false" move entirely. This chapter presents the tendency toward symmetry in the simple Head-and-Shoulders Formation. Patterns of the Multiple or complex type show an even stronger urge toward symmetry—so strong, in fact, that it may be counted on in determining trading policy. The Multiple Formations are produced by a sort of extension or proliferation of the ordinary Head-and-Shoulders Pattern. Rounding Bottoms are commonly referred to as Bowl or Saucer Patterns. Rounding Tops are sometimes called Inverted Bowls.
