Skip to main content
Track Head and shoulders
16 / 37
Search the archiveLibrary
Library

2001issue C121-7

Constructing a slanted head-and-shoulders when the chart is tilted

A slanted head-and-shoulders stays a falsifiable construction when the neckline, the volume-price-analysis check, and the measured-move-floor are rebuilt on the same rules used for a flatter pattern. Detrending only changes how the bars are viewed. The original series remains the reference.

  • A head-and-shoulders is three failed advances after an uptrend and stays unfinished until price breaks the neckline.
  • Volume-price-analysis confirms a top only when the neckline breaks and right-shoulder volume is weak. Excessive volume on that shoulder is evidence that the construction has not completed.
  • The measured-move-floor is drawn parallel to the neckline at a distance below it equal to the head's height above it.
  • Detrending adds one offset to each bar so a tilted structure can be inspected as flatter, while a broken uptrending trendline can serve as both neckline and exit signal.
Entries in this reading3 entries
Current trackHead and shoulders64 readingsTrendline128 readingsVolume-price analysis129 readings

Three peaks and an unfinished neckline

A completed head-and-shoulders is constructed as three failed advances after an uptrend: left shoulder, head, then a smaller right shoulder. The pattern is treated as unfinished until price breaks the neckline.

The neckline is the connecting line drawn through the two troughs between the shoulders and the head. It may be horizontal or steeply slanted, and it is the confirmation and projection baseline.

Head-and-shoulders construction on the April 2001 teaching pane

Session highs form a left shoulder near 1930, a head near 2070 and a right shoulder near 1900, with the neckline held across the two intervening troughs at about 1780. A trader treats the pattern as live only after price breaks that line, then measures the head-to-neckline height for the downside objective. Highs were read from the labeled daily teaching pane that marks 10 April 2001 as the pivot.
Session highs form a left shoulder near 1930, a head near 2070 and a right shoulder near 1900, with the neckline held across the two intervening troughs at about 1780. A trader treats the pattern as live only after price breaks that line, then measures the head-to-neckline height for the downside objective. Highs were read from the labeled daily teaching pane that marks 10 April 2001 as the pivot.Nasdaq Composite (COMPX) · daily · 2001-04-03T00:00:00.000Z to 2001-05-11T00:00:00.000Z

Digitized from the raster; highs rounded to the nearest ten index points. The pane is the detrended window around the 10 April 2001 pivot, so the neckline is drawn flat even though the raw Nasdaq tape was still tilted. The original undetrended series remains the measurement reference.

Volume-price-analysis at a top

Volume typically contracts into the head relative to the left shoulder. A valid top is confirmed only by the neckline break together with weak volume on the right shoulder.

Volume-price-analysis requires that right-shoulder volume weaken for a valid top. Persistent or excessive volume is treated as evidence that the construction has not completed. A developing head-and-shoulders failed after the right shoulder printed excessive volume instead of the required drying-up of volume.

Placing the measured-move-floor

The first constructed objective after a neckline break is a floor placed parallel to the neckline, at a distance below it equal to the head's height above it. That measured-move-floor keeps the projection on the same slant as the neckline used for confirmation.

Slanted necklines and the trendline

Steeply slanted necklines use the same identification and interpretation rules as flatter ones, but they are harder to see and they complete more quickly.

A break of an uptrending support line is treated as an exit signal, and the same line can serve as the neckline of a slanted head-and-shoulders. In this workflow a trendline is that upsloping support line, used both as the neckline and as a standalone break signal when price loses that support.

Detrending as a viewing aid

Detrending is a spreadsheet construction that adds one uniform offset to each bar's high, low, and close. A skewed head-and-shoulders can then be inspected as a flatter structure.

The original series remains the reference. Detrending does not replace the original price scale.

Editorial reading

Editorial interpretation: TradersWeek treats the tilt as a visibility problem, not a reason to change the rules. Rebuild the neckline, apply the same volume-price-analysis test, and place the measured-move-floor parallel to that neckline so the construction stays falsifiable on a slanted chart.

A relative decline, not a finished uptrend

A slanted head-and-shoulders is a predictor of a relative decline, not automatic proof that a long uptrend has ended.

Educational research material, not investment advice. Historical source context does not establish present-day performance.
16 of 37 in the Head and shoulders track
20021-3 pp.Next on Head and shouldersHead and shoulders with dominant-cycle timingA head-and-shoulders-top is three post-advance peaks with the middle peak highest, and the neckline through the two intervening troughs is the dated breakout reference.
All readings on this track · 37 readings
  1. 1982Head and shoulders as a three-path completion test
  2. 1984Stock low clusters as a cycle baseline
  3. 1985Four-phase construction of the head-and-shoulders reversal
  4. 1989Volume-confirmed reversal patterns, stops, and measured objectives
  5. 1991The journal as one checklist for taken and skipped trades
  6. 1991Head and shoulders as a direction hypothesis
  7. 1991Candlestick body and shadow construction with three-Buddha peaks
  8. 1992A three-count drill that binds candlesticks, head and shoulders, and entry rules
  9. 1997Constructing bump and run reversal channels
  10. 1998Testing reversal formations in bond futures
  11. 1999Construction first: extra shoulders, the neckline, and the diamond test
  12. 1999Dead-cat bounce, rollover, and failed reversals
  13. 1999Evaluating time gaps in bond reversal patterns
  14. 2000Constructing head and shoulders and double reversal patterns
  15. 2001Constructing broadening and complex bottoms
  16. 2001Constructing a slanted head-and-shoulders when the chart is tilted
  17. 2002Head and shoulders with dominant-cycle timing
  18. 2002Trendline breaks, right shoulders, and trailing stops
  19. 2003Confirmation tests for bearish top patterns
  20. 2003Commodity top hypotheses on a dollar rebound
  21. 2003A head-and-shoulders test during a bear rally
  22. 2004Pattern breakouts need a primary-trend filter
  23. 2004Reading candlestick closes on trendline and neckline tests
  24. 2004Candle diagnosis needs Western targets and stops
  25. 2004Head-and-shoulders neckline construction
  26. 2005A familiar chart condition is a hypothesis, not a completed decision
  27. 2005A 50-day ceiling and a rising-floor stalemate
  28. 2006A complete trading plan from philosophy to checklist
  29. 2006Thin-market head and shoulders with two averages and MACD confirmation
  30. 2010Head and shoulders as a playback-tested setup
  31. 2011Turning a head-and-shoulders outline into a breakout hypothesis
  32. 2011Volume-confirmed head and shoulders on AIG and Citigroup in 2007
  33. 2013Constructing head-and-shoulders milestone points
  34. 2013Head-and-shoulders geometry versus the filter stack
  35. 2013Algorithmic head-and-shoulders construction
  36. 2018International relative strength as a double-top case study
  37. 2019Structure invalidation before comfort-stops
By fieldChart patterns222 readingsBy year200176 readings
All 64 readings tagged Head and shoulders
Also on Head and shoulders5 readings
1997Constructing bump and run reversal channels2002Trendline breaks, right shoulders, and trailing stops2004Reading candlestick closes on trendline and neckline tests1985Four-phase construction of the head-and-shoulders reversal1989Volume-confirmed reversal patterns, stops, and measured objectives