Over the next several days, we will publish Minor Reversal Patterns, as published in John Hill’s book, Technical and Mathematical Analysis of Trends in the Commodity and Stock Markets.

The reversal patterns listed are based on only several days of action.  They can be very useful when used in combination with the overall chart pattern and when used with other technical tools.  I will emphasize that these factors or formations used by themselves can result in trouble and lead to whip saw action.  Also, market action may not be exactly as shown.  There may be several more days of movement.  My intention is to introduce new concepts.

Pattern 9: SPRING (VOLUME OFF THE BOTTOM)

springWhen a market goes below previous minor low and then springs up to a new high on widening spreads and increase in volume, it indicates good quality demand and show be bought on first reaction.  The entire recent market action has been one of accumulation.

 

 

Pattern 10: HIGHER BOTTOM (TOP) WITH WIDER SPREAD

higherbottomBottom – Frequently the case will be seen where a market is going down and spreads or ranges are getting narrow, then you have a relatively wide spread on the upside and close could be within the range of preceding day.  This is an example of demand overcoming supply and might be purchased, if sufficient other evidence is present.

Top – Reverse of above.

 

Copyright 2015, John Hill & Futures Truth Company

 

 

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