Professional Documents
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Marti n J . P r i n g
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One and two bar patterns are usually
short-term reversal phenomena.
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All one, and two bar price patterns must be
preceded by a short-term up or downtrend.
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These patterns indicate exhaustion, where
market psychology has reached a short-term
extreme.
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Alternatively,
Do not think ofthink
theseofpatterns
them asas offering
black
signals
andrated
white,between one and
but in shades five stars.
of gray.
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These
Do not patterns may occasionally
think of these act as
patterns as black
consolidation
and white, but formations asgray.
in shades of well.
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Outside bars
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Encompasses
Outside bar
trading range of
previous bar and
then some!!
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Encompasses trading
range of previous bar
and Close
then some!!
should be in the
upper part of the range.
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Sometimes encompasses
trading range of several
bars
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If close develops towards the high
expect an upside breakout
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S&P Composite
5-minute bar
Outside bar
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S&P Composite
5-minute bar
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S&P Composite
5-minute bar
Consolidation
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Measuring the Significance of Outside Bars
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Merrill Lynch 10-minute bar
1. Outside bar
Price often
consolidates prior to
rallying.
2. Good volume
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DJIA 60-min Bar
Confirmation
Outside bar
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Union Bank Daily
Outside bar
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NASADAQ 100 Daily
Outside bar
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Dollar/franc 30-minute
“Outside bar”
Outside bar
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Continuation outside bar
Cocoa Weekly
Whipsaw
Confirmation
Outside bar
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Sugar Daily
Possible reverse
..but this head and
is an outside barshoulders
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Outside bar
Dow Jones AIG Index
Consolidation
Outside bar
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Cocoa Weekly
Break above
line confirms
whipsaw.Outside bar
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Bank of India Daily
Bank of India
Outside bar
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Vestel Outside bar
Outside bar
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NYSE Composite
Record volume
Outside
Outside day24 2002
day July
Daily Volume
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Summary for Outside Bars
1. One wide bar preceded by a persistent up or down
trend.
2. Totally encompasses previous bar.
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Second bar
encompassed
by the first
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Better inside
Inside bar
bar
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Second bar
encompassed
by the first
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Inside bars indicate that prevailing
momentum has dissipated because
buyers and sellers are now equally
matched.
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S&P Composite
5-minute bar
Inside bar
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S&P Composite
5-minute bar
Inside bar
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S&P Composite
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Canara Bank Daily
Inside bar
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Summary for Inside Bars
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Two Bar Reversals
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Two bar reversals indicate a dramatic
change in sentiment..
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Sharp rally
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Closes near the high
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Second bar opens
near the high
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Resistance zone
The lower
the
resistance
zone the
better.
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Both bars of roughly
equal height…..
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Closes near high
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S&P Composite
5-minute bar
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S&P Composite
5-minute bar
Price opens near
previous close.
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S&P Composite
Price closes
near its low,
and that of the
previous bar.
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US Bancorp Daily
Two bar
reversal
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Sugar Daily Two bar reversal
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CRB Composite
Two bar reversal
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Dollar/franc Daily Nice low
Two bar reversal
resistance line.
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Look at more than one time frame and more
will be revealed!
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December 2006 British Pound IMM
10-minute bar
False breakout
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December 2006 British Pound IMM
Hourly bar
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December 2006 Dow
30-minute bar
Not much of a
reversal signal.
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December 2006 Dow
Hourly bar
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December Australian Dollar 2006
10-minute bar
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December Australian Dollar 2006
Hourly bar
Instant confirmation
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Using one and two bar patterns as dominos
or reverse dominos.
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DJ Transports Daily
Nice
Twohigh
barsupport line
reversal
Smoothed RSI rallies
KST above oversold and
KST goes bullish
Smoothed RSI
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Summary for Two Bar Reversals
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S&P Composite
Two bar reversal
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6,500
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The The End End
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