As of 03/27/2020   Indus: 21,637 -915.39 -4.1%     Trans: 7,699 -346.29 -4.3%     Utils: 759 +1.01 +0.1%     Nasdaq: 7,502 -295.16 -3.8%     S&P 500: 2,541 -88.60 -3.4%	YTD -24.2%   -29.4%   -13.7%   -16.4%   -21.3%	Targets    Overview: 03/15/2020     19,000 or 25,600 by 04/15/2020   6,700 or 9,000 by 04/15/2020   600 or 800 by 04/15/2020   7,000 or 8,400 by 04/15/2020   2,300 or 2,900 by 04/15/2020
CPI (updated daily): on 3/27/20

As of 03/27/2020   Indus: 21,637 -915.39 -4.1%     Trans: 7,699 -346.29 -4.3%     Utils: 759 +1.01 +0.1%     Nasdaq: 7,502 -295.16 -3.8%     S&P 500: 2,541 -88.60 -3.4%	YTD -24.2%   -29.4%   -13.7%   -16.4%   -21.3%
Targets    Overview: 03/15/2020     19,000 or 25,600 by 04/15/2020   6,700 or 9,000 by 04/15/2020   600 or 800 by 04/15/2020   7,000 or 8,400 by 04/15/2020   2,300 or 2,900 by 04/15/2020
CPI (updated daily): on 3/27/20

Bulkowski on the Bullish Meeting Lines Candle Pattern

In my book, Encyclopedia of Candlestick Charts, pictured on the right, I explore the entire range of candlestick patterns from abandoned babies to windows (not exactly A to Z, but you get the idea), in both bull and bear markets, using almost 5 million candle lines in the tests.

The book takes an in-depth look at 103 candlestick patterns and reports on behavior and rank (3 types: reversal rate, frequency, and overall performance), identification guidelines, performance statistics (tables of general statistics, height, and volume), trading tactics (tables of statistics on reversal rates and performance indicators), and wraps each chapter with a sample trade. I share a sliver of that information below. If you like what you read here, then you will love the book. Help support this website and buy a copy by clicking on the above link.

The bullish meeting lines act in theory as they do in reality -- bullish reversal of the downward price trend. However, the reversal performance is near random, meaning you will not be able to predict the breakout direction ahead of time with any assurance.

Once the upward breakout occurs, price trends, scoring very well for price performance over the coming 10 days, regardless of the bull or bear market conditions. Unfortunately, the frequency rank is 72 out of 103 candlestick types. That makes it somewhat rare, like seeing a hummingbird in Canada during the late fall.

Bullish Meeting Lines: Important Results

Theoretical performance: Bullish reversal Tested performance: Bullish reversal 56% of the time Frequency rank: 72 Overall performance rank: 18 Best percentage meeting price target: 66% (bull market, up breakout) Best average move in 10 days: 5.08% (bear market, up breakout) Best 10-day performance rank: 27 (bull market, up breakout) All ranks are out of 103 candlestick patterns with the top performer ranking 1. "Best" means the highest rated of the four combinations of bull/bear market, up/down breakouts. The above numbers are based on hundreds of perfect trades. See the glossary for definitions.

Bullish Meeting Lines

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Bullish Meeting Lines: Discussion

The bullish meeting lines candlestick pattern acts as a bullish reversal 56% of the time, which is what I consider "near random." However, once the breakout direction is established, price tends to trend. The best performance 10 days after an upward breakout in a bear market is 5.08%. I consider 6% as being a good move, so this one is a bit short. The best performance rank is 27. That is decent but not spectacular since 1 is the best performance out of 103 candle types.

Considering that just 66% of the time does an upward breakout in a bull market meet the price target, the trend after the breakout may not extend as high as the height of the candle pattern projected upward from the top of the candle. Thus, be modest in your targeting and expectations.

Bullish Meeting Lines: Identification Guidelines

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Bullish Meeting Lines: Three Trading Tidbits

If you want a few bones from my Encyclopedia of candlestick charts book, here are three to chew on. The pages refer to the book where the tips appear.

1. Bullish meeting lines candles that appear within a third of the yearly low perform best -- page 582.
2. Reversals occur most often within a third of the yearly high in a bull market -- page 585.
3. Trade in the direction of the breakout when it agrees with the primary trend -- page 583-584.

Bullish Meeting Lines: Example

The chart shows a bullish meeting lines candle pattern, circled in red on the daily scale. The first day is a tall black candle in a downward price trend. Following that is a tall white candle with closing prices between the two candles at or near the same price.

The breakout from this bullish meeting lines candle is downward, joining the downward primary trend. This candlestick pattern acts as a continuation of the price trend. Notice that when the candle pattern breakout and the primary tend both agree, price tends to drop further. Trade with the trend for the highest success rate.

-- Thomas Bulkowski

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"I have never been lost, but I will admit to being confused for several weeks." -- Daniel Boone