Table of Contents
In love and regard for this powerful pattern (one of my best technical buddies), I also call it the “Shampoo Pattern” 🧴
But here’s the real catch:
👉 You have to spot this pattern when the right shoulder is in the making to harness the maximum risk-reward (RR).
🔍 Trade 1: Tilted H&S (19th Aug, Tuesday, 10:20 AM)
- First noted in 15-min time frame, but wasn’t clear. Had to zoom into 5-min tf.
- At this point (10:20 am), PE writers were gaining strength at 24,900, even though CE writers had been dominating since morning.
- Pattern recognition here gave the first hint of possible reversal.
- Nifty moved from 24,920 to 25,000 in next 2 hrs.
🌍 Trade 2: Global Context & 3-Hr Time Frame (12th Aug, Friday, 12:15 PM)
Scenario Setup
- Post Trump’s tariff announcement (8 Apr 2025), markets worldwide—including ours—rallied from 21,700 to 25,500 (+4,000 pts rise, ~18% in <3 months).
- The correction: in the next 40 days, we fell to 24,337 (–1,350 pts, ~5.2%).
- Fibonacci retracement: 38%.
- Bigger picture here is in 3-hr time frame.
The Dilemma
- Left shoulder too close to head 🤔—intuition says inverted H&S, eyes don’t confirm.
- Possible bottom of a 40-day bearish phase.
- Could be a huge RR opportunity if confirmed.
Line Chart to the Rescue
- Switching to line chart solved it ✅
- Left shoulder synced perfectly.
- Next 2 days: Nifty opened Gap Up and sustained the day’s bottom.
- Covered nearly 50% of the fall in just 3 trading sessions!
Trading Takeaway
- Best play here = Far expiry OTM option – BUY.
- Buying far OTM options with small SL could give 1:3 RR.
📅 Trade 3: Daily Time Frame
- As I said earlier—the best H&S trader is the one who spots the right shoulder before it’s fully formed.
- If left shoulder + head is already visible → expect a bounce from neckline → anticipate right shoulder.
- Example: On 6th July 2025, I realized that if Nifty had to fall below 24,500 (towards 24,000), an H&S had to play out.
- Bounce confirmed near 25,000 (where left shoulder was).
- Result: Nifty rose 677 pts, making a high of 25,153.
📌 Current Scenario (25th Aug 2025)
- Nifty is again near neckline 24,500, right shoulder complete.
- Once again, we see left shoulder + head already in place.
- As loyal students of this Shampoo Pattern, we expect a bounce → right shoulder → move down.
And guess what?
👉 Market opened with a Gap Up today 😄 at our right shoulder
👉 If our neck line does not break in a day or two, our H&S studies fails & we, most probably become sideways.
💡 Key Learnings
RR setups in H&S can be massive if entered at the right stage.
Multiple time frames reveal unique versions of the same pattern.
Intuition + confirmation tools (like line chart) are crucial.
The real edge is spotting the right shoulder before it’s complete.
