Reversal Patterns Quiz: Test Your Knowledge

Question 1

What does this guide say matters most for a reversal pattern to be meaningful?

Accepted Answer

Where it forms: a level the whole market is watching matters more than a neat drawing

Question 2

How is a head and shoulders top structured?

Accepted Answer

Three peaks: a left shoulder, a higher middle peak (the head), and a lower right shoulder, with a neckline across the lows

Question 3

When is the standard entry on a head and shoulders top?

Accepted Answer

On a confirmed break and close below the neckline

Question 4

What does an inverse head and shoulders signal, and where does it form?

Accepted Answer

A bullish reversal at the bottom of a downtrend, confirmed on a break above the neckline

Question 5

At what point does a double top confirm as bearish?

Accepted Answer

When price breaks below the low between the two peaks

Question 6

What is the most common way a reversal pattern fails?

Accepted Answer

A false break, where price pokes through the neckline, triggers entries, then snaps back inside

Question 7

Why should you check the higher timeframe trend before trading a reversal pattern?

Accepted Answer

A tidy pattern against a strong trend is more likely a pause than a genuine reversal