For the dendrogram given below, find the most appropriate number of clusters for the data points of the given dataset

appropriate number of clusters

To take the decision for the number of clusters that can best depict different clusters can be chosen by carefully observing the dendrogram formed during the algorithm run.

The best choice of the number of clusters is the number of vertical lines in the dendrogram intersect by a horizontal line that can transverse the maximum distance vertically without intersecting a cluster.

In the above example, the best choice of the number of clusters will be 4 since the red horizontal line in the dendrogram below covers the maximum vertical distance AB.