cocoa2Here is the continuous daily bars for Cocoa.  We have zoomed in on the Upthrust top of late September.  The seven bars of this pattern are numbered.

Bar 1 is a breakout bar.

Bar 2 is clear out possible reversal of breakout.

Bar 3 shows no follow through of previous reversal bar.  Instead, it shows a “99 percenter” up bar.

Bar 4 shows follow through up but reverses and clears out the previous bar with a lower close.  Note the body of this bar is INSIDE the body of Bar 3.

Bar 5 is a breaks the body of the previous 2 bars to the downside.  This is the third sign of a possible reversal to the downside.

Bar 7 is a 4 Close Reversal down and close below the pivot level.

Advertisements