2 bars The pattern is composed of two bars.
Uptrend Look for the pattern in a short-term uptrend.
Outside day The pattern forms an outside day. However, in this case, look for an open above the prior close, a close below the prior low, and a high above the prior day's high.
Key Reversal, Uptrend, Trading Tips
Trading Tactic Explanation
Reversal The pattern is supposed to act as a reversal of the uptrend. However, testing shows that 51% actually continue higher.
Trade Trade in the breakout direction. A breakout occurs when price closes either above the top or below the bottom of the pattern.
Measure rule The key reversal fulfills the measure rule 71% of the time ( market, up breakout). That is, measure the height of the pattern and subtract it from the low price to get a downward target. For upward targets, add the height to the price of the top of the pattern.
If it blows through 97 could go to 84.