Short Term Reversal Patterns

Below are a number of reversal patterns based on only several days of action. They can be very useful when used in combination with the overall chart pattern and other technical tools. These patterns are not designed to be used by themselves.

A. Three Day Close Reversal
Chart: Three days of relatively narrow range days are followed by a day with a wide range which closes below the low of the previous three days. The close should be below that day's mid range.

B. Key Reversal Day
Chart: After an up trend the last day's high is well above the previous price action. The low is below the low of the previous day. The close is below the previous close and the day's mid range.

C. Narrow Range Day Reversal
Chart: An up trend followed by a narrow range day. A down move takes place with a wide range. The close should be below that bar's mid range and reverse at least two closes.

Upthrust/Downthrust Reversal Patterns
Chart: Prices must move above the pivot point. After the price activity above the pivot point, the bar moves below the pivot point with a wide range. The close is below the pivot point and reverses at least two previous closes and be below that day's mid range.