Читать книгу Encyclopedia of Chart Patterns - Thomas N. Bulkowski - Страница 42

	Bull Market	Bear Market
Performance rank	5 (worst) out of 5	3 out of 5
Breakeven failure rate	26.3%	10.2%
Average drop	–12.7%	–21.6%
Volume trend	Downward	Downward
Point D reversal rate	32%	38%
How many reach point D?	95%	98%
See also	Bearish bat, bearish butterfly, bearish crab, bearish Gartley, measured move up

You'll need a computer to find this pattern unless you're incredibly fast with a calculator and have lots of time to waste searching for the thing. If you have access to a computer with pattern recognition software, then this pattern is as plentiful as hair on a gorilla. If your software is better than mine or you have special sauce that you can add to the ingredients, then your pattern may behave differently than the ones I studied.

I measured performance of Fibonacci‐based patterns differently than I do other chart pattern types. That's because we're looking for a reversal at the end of the pattern and not an up or down breakout. Therefore, the layout of this chapter is different from most other chapters in this book.

The bearish AB=CD performs in two ways. First, if you know the first three turns (ABC), then you can anticipate at what price the last turn (D) will appear. This works well, with price reaching D nearly all of the time (95% of the time or more). Second, once price reaches D, it's supposed to turn lower. My tests show this doesn't work well (only 32% to 38% of the time). As I mentioned, this could be a flaw with the model I used. Your software may perform differently.

Let's run through the rest of the Results Snapshot for the bull market (you can compare the results with the bear market). I measured the drop from the peak at turn D (the last in the pattern) to the ultimate low. Of the five bearish Fibonacci‐based patterns I studied, this one performs worst in the bull market when price drops just 12.7%. The breakeven failure rate is 26.3%, which is high. That means price fails to drop more than 5% over a quarter of the time. Volume trends downward, but it's close to random.

Let's take a closer look at this pattern to discover what this mysterious point D is and what the pattern looks like.