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HomeTopicWhat's your favorite breakout, or reversal, chart pattern?
What's your favorite breakout, or reversal, chart pattern?
What breakout chart patterns do you love to see ? Reverse Head and Shoulders? Cup and handle? Reverse gap up? Something else?
For me, my favorite is a reverse gap up pattern. Just set some kind of alert system to make you aware of reverse gap up scenarios happening. You might miss that first rocket ride up, but this chart pattern is great for momentum trading. Expect a slight pullback, after the gap up. Then, when it bounces to test it’s recent high, wait for the share price to break above resistance on large volume, and I mean massive volume. Get on board, and ride that move until it starts to stall out. If you’re adept at it, sell that long trade, and now go short, for a few percentage point ride lower. Rinse and repeat, as the reverse gap ups momentum usually causes the share price to continue to move in the direction of it’s primary trend, which in the reverse gap up’s case, is up. But until the share price has found a new trading range above, you’ll be able to benefit from the volatility, long and short, if you pay attention to what you’re doing.