Bullish Reversal
Head and Shoulders bottom is a 3 valley chart pattern that resembles an a person bust, inverted. The head is below the adjacent shoulders and it acts as a reversal of the downward price trend.
Smart money accumulate Frasers Centerpoint Trust in anticipation of a release of the circuit breaker and a rising price. The price finds support and bottoms at the head low. Then the stock begins recovering, taking volume with it signaling the change from bearish to bullish. Price rounds over at the right armpit and drops to form the right shoulder. Volume begin to subdued here as if the smart money knows a good value whey they see it but are keeping it quiet. Their continuous buying sends the stock moving higher again, above the neckline, confirming the turn from bear to bull.
Bullish Reversal
Price continue its uptrend, when price closes below the neckline, it confirms the head and shoulder chart pattern as a valid bullish reversal to bearish.
Smart money buy Mapletree Commercial Trust since Nov 2018. In Nov 2019, after rising for more than a year, there was a huge volume spike without a spike in price, this form the left shoulder. Fear Of Missing Out investors and momentum join in and buy the stocks sending the price into orbit like a shuttle launching forming the head while smart money continue selling. Market players soon notice the selling and price heads back down. Believing the stock was oversold, demand picks up and sends the price moving up to form the right shoulder. However, without the smart money support for a continued rise, price started to turns down breaking the important neckline.
Conclusion
The average length of forming a head and shoulders bottom or top is over 2 months. If a head and shoulders top does not resemble a human bust, then it is not a head and shoulders top.
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