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Market
Industrials (^DJI):
Transports (^DJT):
Utilities (^DJU):
Nasdaq (^IXIC):
S&P500 (^GSPC):
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As of 11/21/2018
24,465 -0.95 0.0%
10,366 152.59 1.5%
719 -8.96 -1.2%
6,972 63.43 0.9%
2,650 8.04 0.3%
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YTD
-1.0%
-2.3%
-0.6%
1.0%
-0.9%
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 26,800 or 24,500 by 12/01/2018 11,000 or 10,100 by 12/01/2018  710 or 750 by 12/01/2018 6,900 or 7,700 by 12/01/2018 2,650 or 2,800 by 12/01/2018 |
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Written by and copyright © 2005-2018 by Thomas N. Bulkowski. All rights reserved. Disclaimer: You alone are responsible for your investment decisions.
See Privacy/Disclaimer for more information. Some pattern names are the registered trademarks of their respective owners.
Statistics updated on 11/21/2018.
For more information on this pattern, read
Encyclopedia of Chart Patterns Second Edition  ,
pictured on the right, pages 115 to 131.
If you click on this link and then buy the book (or anything) at Amazon.com, the referral will help support this site. Thanks. — Tom Bulkowski
$ $ $
Horn bottoms are H-shaped chart patterns that appear on all time scales, but the weekly charts
show better performance over those appearing on the dailies. Discovered by Thomas Bulkowski in 1998.
Important Bull Market Results for Horn Bottoms
Overall performance rank (1 is best): Not ranked
Break even failure rate: 6%
Average rise: 58%
Throwback rate: 29%
Percentage meeting price target: 74%
The above numbers are based on more than 1,000 perfect trades. See the glossary for definitions.
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Horn Bottom Identification Guidelines
| Characteristic |
Discussion |
| Weekly chart |
Use the weekly chart to locate horns. |
| Price trend |
Downward leading to the pattern. |
| Shape |
Looks like an inverted steer’s horn, two parallel price spikes separated by a week. |
| Spikes |
The spikes should be longer than most in the past year, but in the updated statistics, I didn’t concern myself with spike length and performance improved… They should plummet below the surrounding price landscape, including the middle week. |
| Confirmation |
The pattern confirms as valid when price closes above the highest price in the 3-week pattern. |
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Horn Bottom Trading Tips
| Trading Tactic |
Explanation |
| Measure rule |
See the Measure Rule figure to the right.
Compute the height from the highest price (point
A) to lowest price (B) in
the 3-week pattern then multiply it by the above “percentage
meeting price target.” Add the result to the highest high in the pattern
(A) to get a target (C). |
| Uptrends |
Some horns appear near the end of uptrends, so watch for a trend change. |
| Downtrends |
Horns will usually not mark the end of a downtrend, but they will be close, say within a buck or so. |
| Height |
Tall horns perform better than short ones. |
| Volume |
Horns with heavy breakout volume tend to do
well. Horns
with volume heavier on the left spike and light on the right tend to outperform.
The Spike Volume figure to the right shows an example of heavy left spike volume. |
| Inside week |
When the right horn is inside the trading range of the
left horn (an inside week), the horn tends to outperform. The Inside Week figure to
the right shows an example of this. Spike AB is taller
and completely covers spike CD. |
| Price Difference |
Horns with a small price difference between the spike valleys tend to substantially outperform. Using the Inside Week figure to the right, that means
the price difference between bottoms B and
D. |
| Throwbacks |
Throwbacks hurt performance. |
| Confirmation |
Wait for price to close above the highest price in the pattern before taking a position. However, you can enter a trade by placing a buy stop a penny above
the top of the highest price in the 3-week pattern. |
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The Measure Rule
Spike Volume
Inside Week
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Horn Bottom Example
The above figure shows two examples of horn bottoms on the weekly scale. Each pair of red Hs represents one
horn bottom. Price confirms the pattern when it closes above the highest peak in the 3-week pattern. I show this as a
red line. Buy the following week or place a buy stop at the confirmation price.
— Thomas Bulkowski
Written by and copyright © 2005-2018 by Thomas N. Bulkowski. All rights reserved. Disclaimer: You alone are responsible for your investment decisions.
See Privacy/Disclaimer for more information. Some pattern names are the registered trademarks of their respective owners.
Upgrade definition: take out old bugs, put in new ones.
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