Over the last several days, we have published Minor Reversal Patterns, as published in John Hill’s book, Technical and Mathematical Analysis of Trends in the Commodity and Stock Markets.  Feel free to browse the blog for previous pattern posts, and as always, if you have any questions please don’t hesitate to ask.

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 15: TIME DURATION

patt15

When a market makes a new high for 5 days, it indicates the momentum has shifted to the upside.  Inside days can be ignored in counting the five days.  Commodity may be purchased on a reaction.

 

 

Pattern 16: WIDE SPREAD REVERSAL

patt16When you have a wide spread which closes above a previous rally top, this strongly indicates a change in trend.

 

 

 

Pattern 17: END TO CORRECTION

patt17This reversal formation is one that signifies the end of a correction against the prevailing trend.  This is usually indicated by:

  • A reversal day, or
  • A narrow range day followed by a range increase and a close in the direction of prevailing trend.

Copyright 2015, John Hill & Futures Truth Company

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