encyclopedia of chart patterns 2e - bulkowski 2005

[...]... to the Second Edition • More chart patterns I added 14 new chart patterns • Event patterns I added 9 new types of patterns, which I call event patterns These include earnings surprises, drug approvals, store sales, and stock upgrades and downgrades • More samples I found over 38,500 chart pattern samples, more than double the 15,000 used in the first edition, making many of the statistics rock solid... Buy-and-Hold Investors As I was writing this book, I kept asking myself what is the time horizon for chart patterns? Are they best for day traders, position traders, or buy-and-hold investors? The answer I kept coming up with is: Yes! Chart formations can be profitable for day traders—those people who are in and out of a trade during a single day Many day traders have trading styles that depend on chart. .. historical data of limited duration (some issues no longer trade) For rare chart patterns, I use all three databases and search from 1991 to the most recent date available For plentiful patterns, I use already found patterns and add those appearing during the bear market Thus, the number of stocks I use to find patterns and the amount of historical price quotes varies In the first edition of this book,... book, I used a combination of computerized algorithms and manual searching to find chart patterns The current edition includes the 15,000 patterns from the first edition and others found manually since then, for a total of more than 38,500 patterns Stock Performance from 1991 to 2004 Before reading about the various chart patterns in this book, it is wise to review the performance of the stock market during... they are successful 51% of the time or 90% of the time? No one had the answer I was not willing to risk my hard-earned dollars on simple bromides As an engineer I wanted hard, cold facts, not fuzzy platitudes So, I wrote this book At the back of the book is an Index of Chart Patterns If you suspect your stock is making a chart pattern but do not know what to call it, the Index of 4366_FM.qxd 4/6/05 12:46... 12:46 PM Page xvi Contents 19 Double Tops, Eve & Adam 307 20 Double Tops, Eve & Eve 321 21 Flags 335 22 Flags, High and Tight 350 23 Gaps 362 24 Head-and-Shoulders Bottoms 374 25 Head-and-Shoulders Bottoms, Complex 390 26 Head-and-Shoulders Tops 405 27 Head-and-Shoulders Tops, Complex 421 28 Horn Bottoms 438 29 Horn Tops 451 30 Island Reversals 464 31 Islands, Long 480 32 Measured Move Down 496 33 Measured... Rising 811 PART TWO Event Patterns 827 54 Dead-Cat Bounce 829 55 Dead-Cat Bounce, Inverted 844 56 Earnings Surprise, Bad 855 57 Earnings Surprise, Good 868 58 FDA Drug Approvals 880 59 Flag, Earnings 893 60 Same-Store Sales, Bad 908 61 Same-Store Sales, Good 921 62 Stock Downgrades 934 63 Stock Upgrades 950 Statistics Summary 965 Glossary and Methodology 982 Index of Chart and Event Patterns 993 Index 1001... soon buying the stock again Investment Footprints If you picture in your mind the price action of JCB Superstores, you may recognize three chart patterns: a double bottom, a double top, and a dead-cat bounce To knowledgeable investors, chart patterns are not squiggles on a price chart; they are the footprints of the smart money The footprints are all they need to follow as they line their pockets with... First Edition xi Chart Patterns is the first place to look Page numbers beside each pattern direct you to the associated chapter The chapters are arranged alphabetically in two sections; chart patterns and event patterns Within each chapter, you are first greeted with a “Results Snapshot” of the major findings followed by a short discussion Then, a “Tour” invites you to explore the chart pattern “Identification... analysis does not mean I do not look at the priceto-earnings, price-to-sales, and other more esoteric ratios Then there is the 4366_00.qxd 2/23/05 11:28 AM Page 7 Day Traders, Position Traders, Buy-and-Hold Investors 7 emotional element After going for months without making a single trade, suddenly a profitable opportunity appears and I will take advantage of it Three days later, I will want to trade again . index. ISBN-13 97 8-0 -4 7 1-6 682 6-8 ISBN-10 0-4 7 1-6 682 6-5 (cloth) 1. Stocks—Charts, diagrams, etc. 2. Commodity futures—Charts, diagrams, etc. 3. Investment analysis. I. Title: Chart patterns. II www.wiley.com. Library of Congress Cataloging-in-Publication Data: Bulkowski, Thomas N., 1957– Encyclopedia of chart patterns / Thomas N. Bulkowski. —2nd ed. p. cm. — (Wiley trading series) Includes index. ISBN-13. alt="" Encyclopedia of Chart Patterns SECOND EDITION Thomas N. Bulkowski John Wiley & Sons, Inc. 4366_FM.qxd 4/6/05 12:46 PM Page iii 4366_FM.qxd 4/6/05 12:46 PM Page vi Encyclopedia of Chart