Head and Shoulders

From Reuters Financial Glossary

Used in technical analysis, head and shoulders patterns are considered to be one of the most reliable of all major reversal patterns. The pattern consists of a major rally (the head) separating two smaller, though not necessarily identical, rallies (the shoulders). A neckline can be drawn connecting the bottom of the two shoulders and confirmation is normally accepted on a clear close below that neckline. The inverse head and shoulders is a mirror image of the head and shoulders.

See also: Technical Analysis