.1. Enter a "long" trade above the high of the breakout bar from the trendline.2. Place a "stop" order few ticks below the trend line.3. Target 62% of the range between the top of the first valley to the bottom of thethird valley.
Trade Chart Patterns Like The Pros
1
Trading Three Valleys and A River
The chart above illustrates an example of "Three Valleys and A River" pattern from Tyco's(TYC) weekly chart. From April 2005 to October 2006, TYC formed three "valleys" andattempted to rise three times beyond $30. A trend line is drawn in the chart above connectingthe three valley tops for a trade setup. In October 2006, Tyco closed above the trend line tosignal a potential long setup.
1. Enter a "long" trade above the high of the breakout bar at $27.2. Place a "stop" order below the trend line to protect the trade at $25.5.3. Place a "target" at the 62% range of the all three valleys.
Trade Chart Patten~sLike The Pros
Spike and Ledge Pattern .The "Spike and Ledge" pattern was first defined by Larry Connors and Linda Raschke in thebook, Street Smarts. As the name suggests, markets make a "climax high" or "climax low"(New High or New Low) spikes followed by a resting point or "ledge" then a reversal of theprior trend.A "Ledge" pattern is defined as a series of bars with matching lows and highs within a certainnumber of bars, namely 20. Usually "ledge" patterns are considered as a resting point beforemarkets pick a clear direction, which is mostly a reversal of the current major trend. Ledgepatterns are effective in all time-frames but they are more effective during intra-day trading.
Trade: Set a trade entry at the "breakout" or "breakdown" from the "Ledge" formation. Waitfor a clear breakdown or breakout and enter at the low (or high) of this bar.Stop: Place a "stop" order on the opposite side of the "Ledge" pattern. For long trades, place a"stop" order below the low of the "Ledge" pattern. For "short" trades, place a "stop" orderabove the high of the "Ledge" pattern.Target:Usual targets would be the prior "major swing high" for long trades or prior "major swinglow" for short trades from the "breakdown" or "breakout" levels. If markets experience a"gap" prior to the "Spike" formation, targets after a breakdownlbreakout from the "Ledge"pattern would be the "gap" levels. Otherwise, the target would be a prior "swing low" or prior"swing high" before the "Spike" formation.
-68.00-67.00
.. ........ ............
-66.00
-65.00
-64.00
I '
Ma1U7
'
'
A ~ : u ~
, '
% a ' . i P r d . x u x r
May07
Trade Chart Patterns Like The Pros
Trading Spike and Ledge PatternIQLGC - Daily L= 17.00 0.00
4/1/07 5:01 PM
Target
Target
Trading Spike and Ledge PatternThe example above illustrates a "Spike and Ledge" pattern from the QLogic (QLGC) dailychart. QLogic made a new "high" in November, 2006 and closed near $23. The last few daysin November, 2006 were of high volume trading. After making a new high, QLogic attemptedto sell-off and formed a "Ledge" pattern with matching highs and lows. In January 2007,QLogic broke out of the "Ledge" pattern and presented a "short" trading opportunity.1. Enter a "short" trade below the low of the breakdown bar at $21.502. Place a "stop" order above the high of the "ledge" pattern at $22.503. Target the major "swing low" prior to the "spike" at $19.
Trade Chart Patterns Like The Pros
Trading Spike and Ledge PatternGOOG - Daily L=458.50 0.34
I
Spikeand Ledge
I
Trading Spike and Ledge PatternThe chart above demonstrates a "Spike and Ledge" pattern from the Google daily chart(GOOG). After a sell-off in July 2006, GOOG made a climax sell-off to close below 365 withhigh volume. In September 2006, GOOG attempted to rally back and made a "Ledge"formation with a series of matching highs and matching lows. A breakout above the "Ledge"formation signals a "long" trade to the upside.1. Enter a "long" trade above the high of the breakout bar.2. Place a "stop" loss below the "low" of the "Ledge" pattern.3. Place a "target" at "swing high" prior to the down "Spike."
Trade Chart Patterns Like The Pros
Chapter 11: Tops and Bottoms11.1. Adam-Eve Patterns
I
Trade Chart Patterns Like The Pros
Adam-Eve Patterns
,
"Adam and Eve" patterns are variations of "double tops" and "double bottoms" patterns. Theyhave little more complex trading rules than regular "double bottom" and "double top" patterns,but consist of pattern trading rules similar to Triangles, Pennants and Wedges tradingstructures. Adam-Eve patterns are very reliable as they form at the market tops and at themarket bottoms. Trading these patterns is relatively easy with low-risk trading rules.Inside the "Adam-Eve" patterns, the "Adam" part looks like a sharp spike or "V" bottom;where as, "Eve" patterns have a round bottom (or top). Although rare, sequences of "AdamEve-Adam" or "Eve-Adam-Eve" patterns do occur, and they may be more reliable than"Adam-Eve" or "Eve-Adam" pairs. These patterns tend to signal much bigger moves. Asequence of "Adam-Adam" or "Eve-Eve"' is also very common.Trade: Although these patterns are visually easy to detect, a confirmation is needed forsuccessful trading. Many times "double bottoms" and "double tops" may continue to form"multiple tops" and "multiple bottoms." Trades are entered in the direction of thebreakoutbreakdown of the middle spike between "Adam and Eve" structures.Target: "Adam and Eve" pattern formations are very profitable. The targets can be set at theprevious swing highlswing low of the first swing in the "double top" or "double bottom."Subsequent targets would be set at the next "higher swing h i g h or the next "lower swing low."Stop: "Adam and Eve" patterns also fail. Protect trades using the pattern high for "short"trades and pattern low for "long" trades.
B.,.a. i)C*Bebtgaiijfil$,(&l-
" -'
-
I
Trade Chart Patterns Like The Pros
Trading Adam-Eve PatternRIMM - Daily L=136.75 0.90
I
I
Eve-Eve Bottom
4/1/0711:46 PM
I
Target i
11.
I h
Trading Adam-Eve PatternThe above example shows a "Double Bottom" (Eve-Eve) pattern formation from the Researchin Motion (RIMM) daily stock. RIMM formed a double bottom in May 2006 to August 2006.The middle spike was at $70. A "long" trade is triggered above the high of the breakout bar atmiddle spike.1. Enter a "long" trade above $7 1.2. Place a "stop" order below the low of the "Double Bottom" at $60.3. Target the first "major swing high" prior to the pattern formation at $80. Secondarytargets are set at the next "major swing high" or "major swing low" prior to thepattern.
Trade Chart Patterns Like The Pros
Adam-Eve Patterns
,
GOOG Dally L = 4 M 16 0 00
4/2/07 8 16 AM
00k c r hnd.llmor
M
Trade Chart Patterns Like The Pros
ApmW
Trader Vic's 2B Patterns"Principles of Professional Speculation" written by Victor Sperandeo (Trader Vic), analyzesone of the powerful tophottom reversal techniques. Trader Vic describes this technique, "In anuptrend, if prices penetrate the previous high, but fail to carry through and immediately dropbelow the previous high, the trend is apt to reverse." The converse is true for a down trend.This pattern is also called "spring." The 2B setup looks like a micro "M" pattern and signalstrend reversal when prices stop making higher-highs in an uptrend.The 2B pattern rule is when prices make a new high or new low; they pull back for a healthyretracement. After retracement, the price tries to re-test the new high or new low. When thistest of new high or new low fails, and it does not maintain the prices above the new high orlow, it signals a potential trend reversal. This setup is very powerful and signals the beginningof a correction.Trade: The market attempts to test a recent new high or low, but does not hold the pricesabove this range. Trades are entered to sell the low of the bar trying to breakout or buy thehigh of the bar trying to breakdown.Target: The target is usually the "swing low" prior to the new high for 2B Buy setup or"swing high" prior to the new low for 2B Sell setup.Stop: Protect your "long" trade entry by placing a "stop" below the recent low and protect the"short" trade entry by placing a "stop" above the recent high.
New HighIIII
BreakoutII
Breakdown
Trade Chart Patterns Like The Pros
Trading 2B Bearish Pattern
Trading 2B Bearish PatternThe example above shows Trader Vic's 2B bearish reversal pattern from the Russell Emini( E N ) 5 minute chart. ER2 made a new high at 788. Prices retraced a few bars but tradedabove the bar 1's low. After pullback, ER2 rallied back to test the new-high at Bar 2. Withinfew bars, ER2 closed below the breakout Bar 2's low. This signaled a short trade at 787.7.1. Enter a "short" trade below the low of the Bar 2 at 787.7.2. Place a "stop" order above the high of the breakout Bar 2 at 789.3. Place a target at the "swing low" prior to Bar (1) at 783.5.
Trade Chart Patterns Like The Pros
Trading 2B Bullish Pattern
3
...,
p...,'*".*..."~
.... .**..**... '.,..........'.
Tradinp 2B Bullish PatternThe example above illustrates a 2B "bullish" reversal pattern from the ER2 5 minute chart.ER2 made a new low at 780.5 (at Bar 1). After a new low, ER2 reversed its trend and ralliedback to 784 for a healthy pullback. ER2 attempted to test the new low again at 780.5 at Bar 2to close below the low of Bar (1). As the market continued to consolidate around thebreakdown levels, a long trade is anticipated. A reversal and close above Bar 2's "high"triggered a 2B "reversal." At Bar 3, ER2 reversed and closed above Bar 2's "high" signaling a"long" trade.
I. Enter a "long" trade above the high of Bar 3.2. Place a "stop" order below the recent low at 778.5.3. Place a target at the "swing high" before Bar 1 at 786.5.
Trade Chart Patterns Like The Pros
Trading 2B Patterns
,
Trading 2B ReversalsThe example above shows a series of 2B "bullish" and 2B "bearish" reversals. The firstexample explains a 2B "sell" reversal setup for a "short" trade below the close of bar (3). Thetarget is set at "swing low prior to bar (1). The "stop" order is set at bar (2)'s high. The secondsetup shows a 2B "bullish" reversal. A "long" trade is triggered above the high of bar (2). Thetarget is placed at the "swing h i g h prior to bar (1). A "stop" order was placed below "swinglow" prior to bar (3). The third setup is a 2B "short setup" similar to 2B "short setup" at Shortrade 1.
Trade Chart Patterns Like The Pros
Trading 2B Patterns
2B Buv Setup
,
2B Sell Setup
1: New Low2. Decent Retracement3. Another bar close below Bar 1 Low4. M a r k High of Bar 3. Wait forClose above 4.5. Long above the High of 46. Target previous Swing Highs
1. New High2. Pullback3. Another bar Close above Bar lHigh4. M a r k Low of Bar 3. Wait for Closebelow 45. Short below the Low of 46. Target Previous Swing Lows
Trade Chart Patterns Like The Pros
Trader Vic's 1-2-3 Patterns"Principles of Professional Speculation" written by Trader Vic, highlights another greatreversal pattern called "1-2-3." This pattern is also called "Three Point Reversal" or "ABCReversal." Trader Vic's 1-2-3 reversal pattern is based on the Dow Jones Theory-change oftrend. Prices that are rising or falling must break a trend line. In an uptrend, prices will stopmaking higher highs (for shorts) or lower lows (for longs) in a downtrend. During the uptrend,prices try to reach the recent high, but may fail to hold and close above the high. During thedowntrend, prices may try to reach the recent low and may fail to close below the low. Thisprovides a potential signal.
The criteria for a 1-2-3 pattern taken from Trader Vic's Book is as follows:1. A trend line "breakout" or "breakdown" from the current trend.2. A "test" and "failure" of the previous "high" or "low" after the trend line breakout orbreakdown.3. The breakout or breakdown of a "swing high or "swing low" prior to the rule 2.Trade: After a trend line breakout or breakdown and re-test of "swing lowlswing high," a sellsignal is generated in uptrend when prices close below the "swing low". In downtrends, a buysignal is generated when prices close above "swing high."Target: The target is placed at the "swing low" prior to the "new h i g h in 1-2-3 "bearishsetup" and "swing high" prior to the "new low" in 1-2-3 "bullish setup."Stop: Place a "stop" order above the "swing high" in 1-2-3 "bearish setup" (Short) and belowthe "swing low' in a 1-2-3 "bullish setup" for long trades.
0
Trade Chart Patterns Like The Pros
Trading Trader Vic's 1-2-3 Bearish@ZG - 610 Tick Bars L= 644.6@?.80
Trading Trader Vic's 1-2-3 Bearish PatternThe example above illustrates Trader Vic's 1-2-3 "bearish setup" from the Gold futures 610tick chart. Gold made a new high of 654 at bar (1). After a "new high," Gold retraced andtraded lower to break the trend line at 65 1 (bar 2). Gold attempted to trade higher and retested trend line but could not close above it. After bar (4), prices closed below the low ofbar(2) to signal a short trade.
1. Enter a "short" trade below the low of the "swing low" at 65 1.2. Place a "stop" order just above the trend line at 654.3. Place a "target" at the swing low prior to "new h i g h at 645.5
Trade Chart Patterns Like The Pros
I
Trading Trader Vic 's 1-2-3 Bullish@ER2 D - 30 min L= 787.70 +4 90
Trading Trader Vic's 1-2-3 Bullish PatternThe above example illustrates a 1-2-3 Bullish pattern setup from the Russell Emini (ER2) 30minute chart. ER2 made a new low at 724.5 and reversed its trend to the upside and tradedabove the trend line. After a few bars, ER2 tried to retest the lows at bar (2). At bar (3), E m ' sprices reversed and traded above the recent "swing high" to trigger a "long" trade.1. Enter a "long" trade above the "swing high" at 735.52. Place a "stop" order below the trend line low at 726.3. A "target" was set at the previous "swing high" at 745.
Trade Chart Patterns Like The Pros
Pipe Pattern"Pipe" patterns form at market tops or market bottoms due to price exhaustion. Usually thefirst "Pipe" is a spike in prices and then followed by another spike by at least a similar lengthin the opposite direction. As the name suggests, the "Pipe pattern" looks like two parallel lineswhich form at the market extremes. "Pipe" patterns must be very distinct compared to the restof the bars and must be visually obvious in the chart. "Pipe" patterns can also form during theintra-day rallies or intra-day sell-offs, but they are more reliable in daily and weekly charts.Daily "Pipe" patterns are illustrated by two bars showing opposite sentiment spanned by asignificant time. Pipe pattern trades are entered in the opposite direction of a current trend."Pipe" patterns are rare, and are one of the best patterns to trade.
Trade: Although, the "Pipe" pattern is a very successful pattern, it must have a clearconfirmation prior to trades. For a "Pipe top" pattern, prices must trade below the low of the"lowest low" of the two pipes to enter a "short" trade. For a "Pipe bottom" pattern, prices musttrade above the "highest high" of the two pipes to enter a "long" trade.Stop: For a "Pipe bottom" pattern, place a "stop" order below the "lowest low" of the pattern.For a "Pipe top" pattern, place a "stop" order above the "highest high" of the pattern.Target: The "Pipe" pattern provides an excellent opportunity to trade for low risk and highreward. The first target for a "Pipe bottom" pattern is the length of the larger of the two Pipes.The second target is the twice the length of the largest Pipe above the trade entry. Similarly,for a "Pipe top" pattern, the first target is the length of the largest of the two Pipes, and secondtarget is the twice the length of the largest of the two Pipes below the trade entry.
Pipe Tops
I dl'Trade Chart Patterns Like The Pros
Trading Pipe Top Pattern.CSCO - Weekly L=26.57 0.60
-
-
1 1 1 11~
,1
4/14/07 9:33 A M-29.00
-28.00
Depth
Source:Tradestation
1
Trading Pipe Top PatternThe example above illustrates a formation from Cisco's weekly chart. After a prolong rally in2003, Cisco reached its exhaustion level at $29 and posted a reversal bar to complete the"Pipe top" pattern. The lowest low of the "Pipe top" pattern is at $26.25.
1. Enter a "short" trade below the "lower low" of the "Pipe top" pattern at $26.2. A "stop" order is placed above the high of the "Pipe top" at $29.3. The length of the larger of the two Pipes is $3. The first target is placed at $3 belowthe entry level from $26. The second target is placed at $6 below the entry level from$26.
Trade Chart Patterns Like The Pros
Trading Pipe Bottom PatternEBAY - Daily L=34.98 0.93
1
4/14/079:30 AM
Trading Pipe Bottom PatternThe example above illustrates a "Pipe bottom" pattern formation from the EBay daily chart.In 2006, EBay sold off from the $32 level to the $23 level. At the beginning of August, 2006,EBay posted a "Pipe bottom" reversal bar at $23. The larger of the two "Pipe" bars are at$24.5 and closed above the previous bars' high. The length of the largest Pipe bar is $1.5.1. Enter a "long" trade above the high of the second bar at $24.50.2. Place a "stop" order below the low of the "Pipe" pattern at $22.75.3. Place the first target at $1.5 above the entry of $26. The second target is placed $3above the entry at $27.50.
Trade Chart Patterns Like The Pros
M and W Patterns" M and " W patterns are usually considered as M-Top and W-Bottom patterns with fewdifferences. M and W Patterns usually continue the prior trends where as M-Top and WBottom patterns terminate the trends. Frequently, "M" and " W patterns form during thecongestion zones. "M" patterns rarely form at the "market bottoms" and "W7patterns rarelyform at the "market tops." The volume concept of timing is very similar to their counter parts"Double tops" and "Double bottoms." These patterns are also closely related to "Triple tops"and "Triple bottoms," and "Head and Shoulders" or "Inverse Head and Shoulder" patterns.Trade:Trades are initiated at the breakdown of the necklinehump level. For W-Bottoms, trades areinitiated at the breakout of the necklinehump level. Enter a "long" trade above the high of thebreakout bar at neckline level, and for M-Tops enter a "short" trade below the low of thebreakdown bar at neckline level.Targets:In both patterns, the targets are set at the pattern high for W-Pattern and pattern low for MPattern.Stop:For M-pattern, the trade is protected with a stop loss above the pattern high. For W-Pattern,the trade is protected with a stop loss below the pattern low.
Trade Chart Patterns Like The Pros
Trading W-Pattern
,
The example above illustrates a W-Pattern formation at the market highs from the RussellEmini (ER2) chart. After confirmation of the second leg, a "long" trade is entered at thebreakout of the necklinehump level.
1. Enter a "long" trade above the high of the breakout bar of the hump level.2. Place a "stop" order below the low of the pattern.3. Set a "target" at the "swing h i g h prior to the first leg.
Trade Chart Patterns Like The Pros
eER2.D - 610 Tick Bars L=774.1
Source. Trd&tai;cx-lr
The example above illustrates a combination of M-Pattern and M-Top. M-Pattern is anoccurrence where prices form a M-shape pattern in a congestion zone prior to the trendcontinuation. M-Top is a clear "top" formation and reversal of trend change. M-Pattern andM-Top are tradable and have clear trading rules and have high reliability. In addition, they arepart of 5-point Gartley structures with similar trading rules as Gartley patterns. The majordifference between these patterns is M-Pattern continues in the prior direction compared tothe M-Top which terminates the prior trend.
Trade Chart Patterns Like The Pros
1
Round Top Pattern
1
,
"Round Top" formations are usually reversal patterns that generated over a long periods oftime. Indecisive markets move in slow and gradual changes near the tops and bottoms. "RounTop" patterns are formed when prices trade in a tight range making sporadic "lower highs" an"higher lows". Usually the volume traded in this pattern is very low compared to the priortrend before the pattern formation. Breakdowns from "Round top" patterns will be fast andsharp when price movement occurs. "Round top" patterns also have a high failure rate.Trade: A trend line is drawn connecting the "Round top" to the previous swings to find thepossible trade opportunity. A close below the trend line indicates a trend change and providesa trading opportunity. A "short" trade is entered below the low of the breakdown bar.Target: Successful "Round top" patterns have very sharp moves to the downside from thebreakdown levels. There may be two targets possible. The first target is set at the depth of the"Round top" pattern from the trend line breakdown level. The second target is set at or near theprior "swing lows" before the pattern formation.Stop: For trades taken on inclined trend line breakdowns, place a "stop" order above the trendline (on close basis) and for trades using horizontal trend line breakdowns, use the mid pointof the "Round top" pattern to protect the trade.
/m,in ra
la r r
114
Trade Chart Patterns Like The Pros
$12
rrr
rw r r t rn
The example above shows a "Round top" pattern formation from the Amazon (AMZN) dailychart. From November 2006 to January 2006, Amazon formed a "Round top" pattern. A trendline is drawn connecting the previous swing low to the "Round top." "Round top" depth ismeasured for a target range. In January 2006, Amazon closed below the trend line to confirma "Round top" breakdown.1. Enter a "short" trade below the trend line at $47. The depth of the pattern is $3.2. Set a first target at $44 (depth from entry). Set another target near the "swing low."3. Enter a "stop" order above the trend line (on close basis). A long-term trade stoploss is set above the high of the "Round top" pattern.
Trade Chart Patterns Like The Pros
Trading Round Top Pattern1 PD @ER2 - 610 Tlck Bars L=828.30 4.50
4/20/07 7:29 A M
I
Source. TradeSiakionI
3/13
1
4/16
I
1/17
I
1'18
I
4119
12:30
I
120
Trading Round Top PatternThe example above illustrates a "Round top" pattern formation from the Russell Emini (ER2)610 tick chart. From April 16,2007 to April 18,2007, ER2 made a "Round top" formation.On April 18'~,ER2 closed below the key support areas of "Round top" formation to signal a"short" trade.1. Enter a "short" trade below the low of the breakdown bar at 830.2. Place a "stop" order above the 50% depth range of the "Round top" pattern.3. Target 100% of the "depth" from the breakdown level.
Trade Chart Patten~sLike T11e Pros
Round Bottom Pattern
,
"Round Bottom" patterns are also called "saucers" and they form at the market bottoms."Round bottoms" form after a prolonged down-trend, slow and gradual markets. "Roundbottoms" are relatively reliable patterns and are easy to spot (in curve form) at the bottom andhave weak volume markets. "Round bottom" trading is similar to a "rectangle" pattern tradingand they may be better visible in higher time-frames. A trend line is drawn connecting the"swing highs" of the "round bottom" pattern to initiate the trades at the trend line breakoutlevels. "Round bottom" patterns with a long base may provide more profitable trades.Trade: A trend line is drawn connecting previous "swing highs" prior to the "Round bottom."Price trading above the trend line signals a breakout and a "long" trade. Enter a "long" tradeabove the high of the breakout bar from the trend line.Target: Two potential trade targets are possible in "Round bottom" patterns. The first target isthe depth of the "Round bottom" pattern from the breakout level. The second target is theprevious "major swing highs".Stop: The "Round bottom" pattern trade is based on the trend line breakout. Pattern failure canoccur if the market closes below the trend line for a series of bars. Place a "stop" order belowthe trend line to protect the trade.
Trade Chart Patterns Like The Pros
Trading Round Bottom PatternQER2.D - 610 Tick Bars L=787.70 +4.90-791.OO
Trading Round Bottom PatternThe example above illustrates a "Round bottom" pattern from the Russell 2000 Emini (ER2)futures 610 tick chart. On January 19,2007, ER2 made a series of highs and lows to form a"Round bottom" pattern in the first hour. A trend line is drawn connecting the previous"swing high" and the "Round bottom."I. Enter a "long" trade above the high of trend line breakout bar.2. Place "targets" at previous swing highs prior to the "round bottom" pattern.3. Place a "stop" order below the trend line.
Trade Chart Patterns Like The Pros
Trading Round Bottom Patt,ern
IRound Bottom
1
Trading Round Bottom PatternThe example above illustrates a "Round bottom" pattern formation from the eSpeed (ESPD)weekly stock. ESPD traded in a narrow channel (from $7.50 to $10.25) range from January2005 to April 2007. A horizontal trend line is drawn connecting the highs of the "Roundbottom". The depth of the "Round bottom" pattern is about $2.50. In April 2007, ESPD tradedoutside the channel and closed above recent "swing high" signaling a potential "long" trade.1. Enter a "long" trade above the high of the "swing high" at $10.75.2. Place a "stop" order below the recent "swing low" at $8.00.3. Set "targets" at patterns' depth above the breakout level. Secondary targets may beset at previous major swing high levels.
Trade Chart Patterns Like The Pros
V-Top Pattern"V-Top" and "V-Bottom" are extreme patterns that are easy to spot in a chart. "V-top" patterns(Inverted V) ascending market action and angle of ascent is very sharp with increased volume.Once a top is made, a sharp price reversal occurs and the descending angle usually will mirrorthe ascending angle. There will be clear signs at the top (A Dark Cloud or Island Top pattern)before a reversal can occur. Most of the time, prices will retrace all the way down to the startof the rally to make it a true (inverted V) "V-top" formation.Although the pattern is easy to spot, trading opportunities are challenging due to its steepascent and the fear associated with it. A trend line is drawn connecting the swing lows in a VTop pattern. A breakdown below this trend line offers a potential opportunity to short.
Trade: Connect "swing lows" in the ascent of "V-top" pattern. A close below the trend linesignals a breakdown. Enter a "short" trade below the low of the breakdown bar.Target: After price reversal, "V-top" patterns tend to travel in the similar angle as the ascentangle. A target is set at the "swing low" of the pattern before the rally.Stop: Place a "stop" order