Bar Chart Patterns Flashcards
Books
Thomas N. Bulkowski
- Pullbacks occur more frequently
- Throwbacks occur more frequently
- on downward breakouts with less-than-average volume
- on upward breakouts with above-average volume
Breakout on a gap
Reduces the odds that a retracement will occur
Volume on a rectangle pattern
Tends to decline
Shortfall
When, in a rectangle formation, the price fails to reach either the support or resistance zone
Buying the support and selling the resistance
Works better in a trending channel than in a rectangle
H&S, rectangles, triangles, channels, flags, pennants, wedges and bottom picture
Diamond pattern
- A broadening pattern followed by a triangle
- Usually happens at the top of a sharp upward rise in prices
Ideal situation for trading triangles
- Definite breakout
- High trading range within the triangle
- Upward-sloping volume
- Gap on the breakout
- *Seems to work better with small-cap stocks in a rising market
Broadening pattern alternative name
Megaphone, funnel, reverse triangle and inverted triangle
- Rising wedges
- Declining wedges
- tend to breakout downward (69%)
- tend to breakout upward (92%)*
- *Bulkowski 2010
Cup and handle pattern
Flags and pennants
are usually continuation patterns
Island reversal
Breakaway gap
Runaway gap
Exhaustion gap
Common gap
Sequence of gaps
One-bar reversal
When a trading bar high is greater than previous bar high and the close is down from the previous bar close
Two-bar reversal
Horn pattern
Similar to a two-bar reversal but with a smaller bar in between