![]() I downloaded the data from Tiingo but not all stocks currently trade. You can use the Patternz simulator to reproduce the charts in full. A throwback completes atīelow are some of the lessons I learned from trading these patterns over the decades. Price recovers and busts the pattern atĬ when price moves above the top of the chart pattern. Price bounces between two diverging trendlines before it closes outside the bottom trendline atĪ. A strongĪdvance begins at point D and that leads to the right-angled and ascending broadeningįormation. The above figure shows an example of a right-angled and ascending broadening formation. Upward breakouts did best in the 2000s but worst in the 2010s.ĭownward breakouts outperformed in the 1990s but didn't vary much among the decades.īroadening Formations, Right-Angled and Ascending: Example The above table shows the performance of right-angled ascending broadening top chart patterns in bull markets over the last three decades. More (#ad) Broadening Formations, Right-Angled and Ascending: Time Performanceīull Market Performance Over Decades Breakout Direction Wide patterns (both breakout directions) perform well. Tall patterns perform better than short ones. The best performing patterns are those with a short-term (less than three months) rise leading to the pattern.ĭownward and upward breakouts perform best when the breakout is within a third of the yearly low.Ī downward volume trend results in the best postbreakout performance. When price touches the horizontal trendline for the third time and begins rising, buy. Upward breakouts) or subtract it from the horizontal trendline ( B, downward breakouts) to get the price target ( C).īuy at the horizontal trendline when price starts rising and sell or sell short once price turns at the top trendline. To the horizontal trendline ( B) and multiply it by the above "percentage meeting price target" (see Important Bull Market Results). Compute the height from the highest peak (point A in the Measure Rule figure to the right)
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