![]() ![]() A rectangle is bearish when the price breaks downwards through the support line.Ī rectangle chart pattern has an 85% success rate on an upside breakout, achieving an average 51% profit in a bull market. ![]() The pattern is flexible and can break out up or down, making it bearish and bullish. Inverse Cup and Handle: 82% Reliability for Short-SellersĪ rectangle is a well-established technical analysis pattern with a predictive accuracy of 85%. Verifying a high trade volume at the breakout increases pattern reliability. After the price closes below the rim, enter a short trade and place a stop-loss above the breakout. To trade inverse cup and handle chart patterns, look for a price breakdown below the inverse cup’s rim and the bottom of the handle. How to Trade the Bearish Cup and Handle Pattern The “handle” emerges when the price rallies once more, usually ranging from 5-20%, and near the low of the inverse cup before resuming its downtrend. The “inverse cup” element of the pattern creates an inverted U-shape in price, followed by a decline that finishes near the price level where it started. This continuation pattern comprises two key features: the inverted cup and the handle. Research shows that the inverse cup and handle boasts an impressive 82% success rate. ![]() Bearish Chart Patterns Explainer VideoĨ Bearish Patterns Proven Reliable & Profitable 1. After selecting the desired criteria, traders can apply the filter to the Finviz screener. Set Up Stock Chart Pattern Scanning with FinvizįinViz offers a range of pre-defined filters and sorting options, enabling traders to quickly narrow their search by sector, industry, market capitalization, and more. This is extremely useful to traders who want to monitor potential bull trade opportunities. You can easily find stocks exhibiting this pattern by selecting Screener > Technical > Charts > Pattern > Select Pattern. How to Scan For Bearish Patterns with FinViz?įinViz has a great feature for scanning bullish patterns. With TrendSpider, find stocks with bearish patterns, then use the platform’s advanced analytics to assess its historical effectiveness. This allows traders to compare the performance of their strategy across different periods and markets. The benefit of AI-driven technical analysis tools, like TrendSpider, is the ability to backtest historical data. Scan for this Chart Pattern with TrendSpider How to Scan & Backtest Stock Chart Patterns With TrendSpider You will be presented with a list of stocks with bearish patterns. Visit TrendSpider, select Market Scanner > All of the Following > Chart Pattern > Select Pattern > Scan. Scanning for bearish patterns with TrendSpider is easy. How to Scan For Bearish Patterns with TrendSpider? Finviz is a fast and free pattern scanner, whereas TrendSpider enables full backtesting, scanning, and strategy testing for chart patterns. TrendSpider and FinViz enable complete market scanning for bullish and bearish patterns. There are currently two trading platforms offering bearish chart pattern scanning and screening. Automatic Pattern Recognition with TradingView Scanning for Bearish Chart Patterns ![]() Now, a chart with any bear pattern formations will be clearly marked. Go to TradingView and click Indicators > Technicals > Patterns. You can automatically identify bearish patterns using TradingView. Bearish Chart PatternĪll statistics in this article are sourced with permission from Tom Bulkowski in his excellent book The Encyclopedia of Chart Patterns (Wiley 2021) How to Automatically Identify Bearish Chart Patterns? For example, the Inverted Cup and Handle pattern has a 58% chance of a price decline (success rate), and the average price decrease is -17%. This table shows the bearish pattern success rates (probability of a price decrease) and the average price decrease after emerging through pattern support. Bullish Chart Pattern Reliability & Profitability Is the megaphone pattern bullish or bearish?ĭue to the stock market’s inherent bull bias, short-selling using bear patterns is risky, and rewards and profits are not as large as using the most bullish chart patterns.What are the risks when trading bearish patterns?.What is the most bearish chart pattern?.Is a head and shoulders pattern bearish?.8 Bearish Patterns Proven Reliable & Profitable.How to Scan For Bearish Patterns with FinViz?.How to Scan For Bearish Patterns with TrendSpider?.How to Automatically Identify Bearish Chart Patterns?.Bullish Chart Pattern Reliability & Profitability. ![]()
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