Patternz is a FREE desktop software application that finds chart patterns and candlesticks in your stocks automatically and displays them on a chart or lists them in a table.
It does not contain any spyware and there is no registration process. It works with Windows 7 (and more recent) versions of the operating system. An older version
that works with Windows 3.11 and XP is available here.
Built-in downloader (Update Form) updates quote information, new to version 5.4. Supports 5 quote services as of version 6.3
List Form finds and lists chart and candlestick patterns for use by Excel and other programs.
Tool tips (hover mouse over a control) and help buttons provide instant help. No need to dig through an instruction manual.
It's FREE with no registration, both to download and use.
Patternz Tour: Main Form
The picture shows the Main Form as of version 7.27
The white area (1) lists your stock quote files (if any: .txt or .csv files). Each file contains quote information from ONE stock that the program uses. You must provide the stock symbols
(Where do I get symbols: explained) of your choice.
The Browse Portfolio Location button at 2 helps locate data files shown in 1. The selected path appears at 5 (unless you select files, in which case, the number selected is shown).
The menu bar (3) shows:
Exit to quit the program.
Analyze for fundamental analysis. Note: This was removed as of version 7 because yahoo stopped supporting fundamental information.
Candles selects candlesticks you wish to find.
Fib: Fibonacci finder (retraces and extensions).
File Format to setup the format of your data files (needed only for advanced users).
Manual Score to manually score a chart pattern for performance.
News to get news about securities you follow. (New to version 7.5)
Patterns selects chart patterns you wish to find.
Rel Strength (relative strength) helps you select stocks with increasing momentum.
Seasonality guides the user to future stock performance (New to version 7.4).
Splits/Divs gives information on stock splits and dividends.
Fix Split: Corrects any bogus splits.
Help contains additional information about the program, reviewing the license, main form help, removing the program, and restoring the forms to their original size and location.
When checkbox 6 is checked, the portfolio feature (4) appears. This allows you to setup multiple portfolios to contain different stock symbols (quote files). Click the Help button (7) for more information.
The buttons near 2 (clockwise from left): Browse Portfolio Location find where you put your quote files (1), Score to automatically score your chart patterns for performance, Indicator runs the chart pattern indicator (CPI), Simulator runs a trading simulation, Select All highlights all files listed in 1, Chart the files, List found patterns, and Update stock quote data.
After highlighting stock quote symbols in 1, some of the buttons near 2 will ungray as will menu items (3).
Patternz: Candles Form
Full candlestick support appears starting in version 5.2. The above form shows the number of candlestick patterns supported (105) as of version 7.0.
On the Chart Form, hovering over a price bar will cause Patternz to run candlestick recognition. The results of what it finds appears on the form.
The List Form will report candlesticks found on the specified date range, too, in list format. Both of those forms depend on this form to identify which
candlesticks you wish to search for.
New to version 7 is the Top 10 buttons in the bottom center of the form.
The Reversal button checks the ten candlestick patterns that indicate a reversal most often. A reversal occurs when price breaks out on the same side as it entered the candle.
For example, a reversal occurs when price enters a candle pattern from the bottom and breaks out downward (that's a reversal from trending up to down). A high reversal rate says nothing
about the strength of the trend which follows.
The Continuations button checks the ten candlestick patterns in which the outbound trend direction matches the price trend preceding the candle most often. For example, if price rises
into a candle pattern and breaks out upward, then the candle acts as a continuation of the upward price trend. A candle with a high continuation rate says nothing about how long the
post-breakout trend will last.
The Best Performing button shows the top ten candle patterns that performed best over time (the largest gain or loss after the breakout).
Be aware that just because a candle shows a reversal or continuation most often doesn't mean a tradeable trend results. Reversal or continuation reflect a change (or not) of the inbound
price trend versus the breakout direction.
Choose the breakout direction you're interested in (up or down) then choose one of the Reversals, Continuations, or Best Performing
buttons. Clicking one of those will check ten candles.
If you click more than one of those three buttons, additional candles will be checked (some may be duplicated) without the prior selections being removed. For example, if
a northern doji is the best reversal and the southern doji is the best continuation, clicking Reversals will check the northern doji and clicking Continuations will check the southern doji,
so BOTH candles will be checked.
If you wish to see only one set of top 10 candles, then click the Clear button first before clicking Reversals, Continuations, or Best Performing.
Patternz: Chart Form
Pictured above is a reduced snapshot of the Chart Form as of version 7.10. Patternz charts your stock data and searches for chart patterns and candlesticks.
Shown is a double top chart pattern in the S&P 500 index.
This is an example of an annotation. You can turn on/off annotations on the Setup Form. Click the Setup button on the bottom right of the form.
The colored lines are the targets. They are color coded on the grid on the lower left of the form and on the Setup Form. Pick the targets you wish to display on the Setup Form.
The wavy blue line is a moving average. You can control the appearance of this line on the Setup Form.
Click a row in this grid to highlight the pattern on the chart. Candlesticks will appear as two small red circles on the chart (not shown here). Candlestick display is new to version 7.10.
Not all of the grid appears in this figure. A 0 value for the ultimate high/low means the program did not find the ultimate high or low yet.
Note about the volatility stop. This is calculated ending the day before the breakout. If not enough data is in the file before the breakout date (20 days worth), then you'll see a 0 stop price.
You'll also see a 0 stop price if the calculated stop were to be below 0.
Most of the controls at 5 are self-explanatory except for these.
Check or uncheck the Strict checkbox to find patterns and candlesticks using strict or loose rules.
The Skip check box will skip any chart not finding a pattern you're looking for. For example, suppose you wish to view all double bottoms
in 400 stocks. On the Patterns form (click the Patterns button), select double bottoms (ONLY) and return to the chart form. Check the Skip check box. Click the next button (>) to
view the next chart which shows a double bottom. The program will automatically skip charts in which double bottoms do not appear. This feature allows you to fly through the charts, stopping
only at patterns of interest. You may wish to run the scan again after toggling the state of the Strict check box (run through the stocks with Strict checked and another scan with it unchecked).
This feature supports both chart patterns and candlesticks (new to version 7.10), so if you want to stop only on double bottoms and triple bottoms, then select only those two on the Patterns form and follow the above procedure.
Use the Symbol text box to chart a specific symbol. Note: You must have data for that symbol already available.
Finding and Loading are progress bars for finding patterns and loading stock symbols.
Use the Fib button to chart Fibonacci retracements and extensions. Right mouse click two different price bars (often a minor high and minor low) then click the Fib button.
The Setup button allows you to change the behavior of the program, including adding a moving average, changing colors of the candlesticks or chart background, and so on.
Click the Portfolio button to change to another portfolio.
Patternz: Chart Pattern Indicator
The picture shows the Chart Pattern Indicator Form as of version 7.3.
From the main menu, highlight the files you wish to include in the indicator analysis. The index file you choose later (see 2 below) will be excluded from the analysis automatically. Often
you can just click the Select All button on the main form to highlight all files.
Click the Indicator button on the Main form to take you to this form.
1. This is where the program draws the index (candlestick chart) and chart pattern indicator (the long, vertical, red (bearish signal) and green (bullish signal) bars plus the
wavy blue line, which is the indicator). When analysis is complete, a Results box appears showing the last 7 days of data.
Specify the from and to dates that you wish to examine.
The radio buttons give charting options, such as show when a signal changes from red to green (or green to red), show all signals, or don't show signals (indicator only).
Enter the symbol for the index of your choice in the Index text box (or use the Browse button to find it). This should be a leading market index of the country where you get your symbol data (for example, use symbols for the Dow industrials or S&P 500 composite for United States data).
Help shows a help form.
Clipboard copies scan results onto the clipboard for pasting into another program like Excel or Clipboard.exe.
Results shows the last seven days of data (you must run a scan first).
The Fib Finder Form is new to version 6.8. It allows you to search files for Fibonacci retraces and extensions.
Access this form after selecting files you wish to search on the Main Form. That will ungray the menu item and clicking on the item will take you to this form.
Click the Help button on the form for specific instructions.
Patternz: File Format Form
NOTE: For most users, this form is no longer needed. I show it here only for advanced users, ones not using the Update Form to update their quote files.
Shown on the right is a reduced version of the File Format Form as of version 7.3.
Access this form from the Main Form (See File Format menu option).
This form allows you to tell Patternz which quote items appear first, second, and so on, in your data files.
The form provides a small chart (1) to see if your configuration is charting properly, a list of files to chart (2), sample file contents (3), a grid of file information (4), and an area to configure your data files (5, 6).
Each file MUST have the same format. So if you change to a different quote provider and they have a different format, then replace all of your quote files.
I'm talking about quote files that YOU provide, NOT those which come from one of Patternz's quote providers. Patternz understands the differences in Patternz's quote providers,
so there's no need to remove existing quote files if you change to another Patternz listed provider (see the Update Form for more information).
For detailed help with this form, click the Help button on the form.
To use this form, setup the column order by checking the appropriate check box in 5 and assigning the column number matching
the order shown in 3. Adjust the date format (6) to match that shown in 3. When you're finished, click Graph and the results will appear in 1 and 4.
If your file contains a date and time in the same column, then check the "Date & Time" checkbox in (5), leave the "Time (separate column only)" checkbox unchecked, and
make sure a 0 appears in the associated Time's column number.
For example, the first line of 3 shows that the date comes first, so the Column Order's Date text box (5) has a 1 in it. The next column in 3 shows the
opening price. In 5, check the Open check box and enter a 2 in the Open text box. Similarly, continue assigning a column to each
of the items in 5 matching those in 3. If 3 has a column not matching a control in 5, then be sure to adjust the column number
appropriately (often by skipping a number).
For example, say the first line of 3 shows: "Date,Split Factor,High,Low,Close,Dividends." In 5, set Date to column 1, High to column 3 (not 2, because
Split Factor appears in column 2), Low to column 4, and Close to column 5. All other check boxes should be unchecked and the associated text boxes should have a 0 column number (0 means unused).
You would ignore both Split Factor and Dividends in 3 because there is no matching control in 5.
Patternz: Fix Split Form
This shows the Fix Split Form. The form is easy enough to use, just follow the instructions listed on the form.
Patternz: Forecast Form
This is the Forecast Form, new to version 7.21 and it shows the display after a run. I was interested in buying WDAY and ran the program to see what it forecast as the next trend.
Patternz correctly predicted the uptrend would continue, which it did (the target is off the chart, at the top).
You and you alone are responsible for your investment or trading decisions. Past performance is no guarantee of future results.
Quick Start: To use this form NOW, do the following.
On the Main Form, select all stocks (or all that you want to search for new patterns). (A run with 487 stocks, each with 5 years of data takes 25 seconds to run on my computer).
You may wish to use longer files or more stocks to find more patterns.
Type a stock symbol in the text box to the upper right of 10 (see the above figure, or click Browse to find one).
Click Graph to show the stock.
RIGHT mouse click on two price bars, widely separated (perhaps at the start and end of the chart).
A pattern should appear in bold red, like you see here at 3.
With the radio button on Start (below 6), count the number of red segments (straight lines) in the pattern, starting from the right (most recent). The above figure shows a pattern with 4 segments.
Stop at 3 or 4 and click the associated start of segment 3 or 4. What you're doing is narrowing the pattern to 3 or 4 segments, something simple enough to find in other stocks.
If you flub up, be sure to change the radio button from End back to Start, because it'll automatically switch to End after you click a bar (and back again with the next click).
Click Preview to see the new pattern. This shortened pattern is what will be searched for in other stocks.
Click on Normal rules, 9 (it'll probably be on Strict).
When the run is done, a message box like that shown at 1 will appear.
Click OK and the targets will appear on the chart if it's possible to draw them.
You'll quickly get the hang of this form. The tricky part is to watch which pattern's date your clicking (start or end?). If you click on a row in the grid, the form will show that stock.
However, if you click Start again, it'll use the new stock as the benchmark and find patterns similar to the new stock. To restore the original chart and settings, click the Reset button BEFORE
you click Start.
Confused? You'll figure it out and probably be pissed when you discover that instead of seeing patterns based on WDAY (in my example), you'll be searching for a pattern in some other stock instead.
You'll have to follow the above steps to fix this. To avoid this, click Reset before you click Start.
Here's an explanation of the controls
1. This box appears after a run completes and if you click the Results button (10). The results for stock WDAY says that price will continue rising 92% of the time, reaching the Continuation
Target (which is off the chart). After that, price may reverse and drop to the reversal targets shown in 4.
2. The red vertical lines show the start and end dates of the pattern where you clicked.
3. After clicking Preview (10), this is the pattern you're looking for, highlighted in thick red.
4. These are the forecast targets for the stock, as described in 1 above. The top is Reversal Target 1 and the bottom is Reversal Target 2. The Continuation Target doesn't appear because
it's off the scale.
5. This is the grid where the results appear. If you click on a row, it'll chart the stock and show the pattern. Thus, you can flip from chart to chart, looking at similar patterns and how
price behaved after the pattern ended. Results won't be exact, but the pattern's signatures will be similar.
6. Find Pattern (blue label). Right mouse click a price bar on the chart to automatically fill in either a starting or ending date, depending on which radio button is clicked, or you can type in the date. The radio button will toggle back and forth after each bar click. Thus, with the Start radio button checked, you can click on a price bar for the start and click again for the end price
bar without changing the radio button. If you're confused, right click several times on one price bar and you'll see the radio button change.
7. If you want to see more or less of the chart, adjust the dates here.
8. Scale. The program works best on the daily scale but you can select other scales as well. If you have intraday files, then ignore these controls.
9. Rules. The program offers three types of rules to find similar patterns: Strict, Normal, and Loose. Strict will look for nearly exact matches and loose will allow quantity over quality. Play
with the three and see what results you get.
10. Controls. See the next section.
Controls, listed alphabetically.
Browse. Use this button to find a stock symbol or you can type one into the associated symbol text box. The symbol must be in the same folder as the ones your searching.
Clipboard. Click on grid row(s) and click Clipboard to copy the Results (1 on the chart) and the grid results for pasting into another program like Excel or Notepad.
Done. Exit for form.
Graph. Redraw the stock for the symbol, dates, and time period selected.
Help. Offers additional help. Tips may help also.
Preview. Draws the chart pattern in bold red found between the Start and End dates. If none shown, select different 'Find Pattern' (6) dates.
Reset. When you click Start, Patternz captures the stock symbol and some of the settings. Clicking Reset will restore the settings. This is useful if you click a grid row to chart one
(or more) of the found stocks. To restore the benchmark image, click Reset BEFORE you click Start.
Results. After a run completes, this shows the message box of results (1).
Start. Begin a run. Note that the saved Reset button information is reset when you click Start (see Reset if you're confused).
Stop. Quit a run before it ends normally.
Tips. Helpful hints on running the program.
1. For the best results, try finding patterns (using the pattern's start and end dates) with 3 segments for Strict, 4-5 for Normal, and 6-7 for Loose rules. What's a segment?
The chart of WDAY at 3 shows a pattern with 4 segments, or straight lines (in bold red). The second segment from the pattern's start may be hard to see, but it's there.
2. When selecting the pattern's start date, click the START of the segment, not the middle of it. That's why using the Preview button is handy. It'll show you what it believes
is the pattern and you can refine it by adjusting the start date. Note: The pattern's start or end date may be different than what you select. That's because the program ignores small
up and down moves.
3. The symbol (stock) is not included in the results (1) or grid results (5).
4. Does the forecast work? Not always, of course. At least you'll be able to find similar patterns to see how price behaved after the pattern ended in the past. Maybe it'll help improve
5. You and you alone are responsible for your investment or trading decisions. Past performance is no guarantee of future results.
Patternz: List Form
The picture shows the List Form (as of version 7.1).
From the main menu, select the stock symbols you wish to search and then click the List button. The List Form appears.
After you click the Start button, the program will load each file and search for chart patterns and candlesticks. If it finds any, they will appear in the list, similar to that shown.
The Graph button will chart the selected (highlight the ones you wish to review in the list box) list box entries.
You can sort the list by clicking the list box header labels (Stocks, Last Close, Pattern Description and so on).
Click the Help button on the form for additional help.
Patternz: News Form
The picture shows the News Form (new to version 7.5). Use this form to get news on stocks. You'll need a Tiingo token and a paid subscription to their service (as I write this, anyway)
to use this form.
The controls are either self-explanatory or the help text on the left side of the form will provide assistance.
Enter your Tiingo token in 4. Type in the stock symbol (if more than one symbol, separate them by spaces) at 5, and press Start. The program will use the Internet to check if there is news on your stock files.
News appears at 1.
Number 2 shows options to control what you receive from Tiingo. For example, say you want to read three news items. Enter a 3 (like that shown) in the numeric up/down control. You can better
target the news items by using the date controls.
Item 3 allows you to remove items from the news feed. For example, I chose not to include the source of the article, so I left that control unchecked.
Be aware that using this form will affect your Tiingo subscription. In other words, if your plan allows 1 gb of data per month, you might well exceed that if you check news often, especially on multiple symbols.
Patternz: Patterns Form
Pictured above is the Patterns form, as of version 7.27. Patterns shown grayed here have not been implemented and may never be implemented.
This form allows you to select the chart patterns you wish to view. You can access this form (by clicking the Patterns button on the Main Form, Chart Form, List Form, or Simulator Form.
Checking the associated chart pattern means Patternz will search for that pattern in your data files.
The controls are self-explanatory, but you can hover your mouse over the buttons for specific help. Also note that some of the patterns have a button associated with them (question mark button
for gaps, fakey, and three-bar, or the Wolfe wave button). Click those for important information.
Patternz: Relative Strength Form
Momentum traders want to buy stocks with increasing momentum. This form helps find those stocks.
Green cells mean improving performance (higher momentum) from period to period on the same stock. Red cells mean lower performance.
Most of the numbers shown are performance percentages.
For example, Verisign (VRSN) has 4 green cells in the row (3 are shown). End of day closing prices were not available when I made this screen capture,
so cell D is blank. Cell E shows that on 8/18 (Friday, the prior trading day), the stock gained 0.3%. For the week, the stock lost 0.5% (F) compared to the prior week's loss of 1.8% (G). Because -0.5%
is a smaller loss than 1.8%, cell F is green.
Interpret the other cells in a similar manner for periods of day, week, month, 3 months, and 6 months.
To use the form...
Select stocks you wish to scan in A.
Select an end date. If you select a holiday or weekend, the date will be changed automatically for the prior trading day.
Click 'Start' or 'Scan All Portfolios'
The results will appear in grid B
Click cell C to highlight all rows in the grid. Use this as a quick method for highlighting all rows for the Clipboard (button). Use the Clipboard button when you wish to view the results
in another program, such as Excel or notepad.
To sort the performance, click on one of the header rows. An arrow will appear (circled). Click the cell again and the arrow will reverse and so will the sort.
These cell commands are common to all Patternz grids.
For additional help, click the help button on the form.
Patternz: Score Form, Automatic
Version 7.25 restored the Score Form to the program but you'll have to select a data vendor. The user interface is a bit different from what's pictured here.
The Score Form is new to version 6.1. It allows you to score your chart patterns automatically. Chart patterns with scores above 0 tend to outperform those with scores below 0.
Generally, the higher the score, the better the performance. Scores range from +10 (best) to -10 (worst) for both up and down breakouts. Not all chart patterns are scored.
Access the Score Form from the Main Form by highlighting files and clicking the Score button.
This form appears similar to the List Form and the controls have a similar function.
Click the Help button for specific help.
After running a scan on a number of stocks (like that shown above), use the Test button to determine how well the scoring system works for your markets.
It will list the scores and sort the results according to their score for you.
The screen capture on the right (of stocks in the S&P 500 index from 1/2014 to 8/2017) is an example of one such test.
The results are clearest for downward breakouts. For example, there were four chart patterns with scores of 4. Price dropped an average of 28.2% after the breakout (circled in red).
Compare that with nine chart patterns with scores of -8 (circled in blue). They performed less well by dropping an average of 9.2% after the breakout.
Scan down the list of gains (losses, really) for downward breakouts, and it's clear that the higher the score the better the performance (meaning the larger the drop for traders shorting the stock).
DISCLAIMER: The scoring system is a tool to help you select better performing chart patterns, but there is no guarantee. Some patterns will work better than others, regardless of the score. How you trade will determine success or failure. The gains shown on the Score Form represent PERFECT TRADES, so your actual trading results will vary. Past performance doesn't guarantee future results. YOU ALONE ARE RESPONSIBLE FOR YOUR INVESTMENT DECISIONS. Please understand that the Score Form does NOT make recommendations as to which security you should trade.
Patternz: Score Form, Manual
The Manual Score Form is new to version 6.6, but Patternz version 7.1 is shown above.
Chart patterns with scores above 0 tend to outperform those with scores below 0.
Generally, the higher the score, the better the performance. Scores range from +10 (best) to -10 (worst) for both up and down breakouts.
Access the Manual Score Form from the Main Form menu. You can highlight a stock file you wish to score or do so after the form loads.
The picture shows the score for Apple Computer's double top chart pattern. The two red vertical lines show where the chart pattern starts and ends. The blue line is the breakout day, and
the green line shows where the trend starts.
Follow the steps from the middle left to the lower right.
It helps if the chart pattern you're scoring is in a stock you follow. If so, you can click on the stock from the main form (as described above) or access it using the Browse button on this form
(about midway between numbers 1 and 2 on this figure). Find the location of the stock and click on its name (1). The stock will chart. The chart may or may not show the chart pattern you're
interested in scoring. You can adjust the start and end dates of the chart pattern and then click Graph to update the chart. The chart will add a margin so a year's worth of price data will
be displayed, if available.
Select the chart pattern your interested in scoring from the drop down list (near 1 where it says Pattern). The form shows Double Top, Eve and Eve, as an example.
You can click 2, "Get Existing Pattern's Dates" to automatically fill in the pattern start and end dates (if a chart pattern is shown)(above 3) or you can manually enter the dates yourself.
Alternatively, click on the "Pattern start" text box and then right mouse click on the price bar (on the chart) where the pattern begins. The date of that bar will be pasted into the text field near 3.
The same technique applies to the end and breakout dates as well as the pattern's height and breakout prices (step 1). Fields with red labels use this pasting mechanism. After pasting, the
focus automatically moves to the next field so you can right-mouse click on the next item.
Try it and you'll get the hang of it. You need not chart a stock to be able to score it, but you'll need the various pieces of information that the scoring system requires. Being able to
chart it makes scoring a pattern a lot easier.
Proceed to Step 1: Chart Pattern Height (below 1 on the figure) and fill in the information. If you click "Find 1, 2, 4" and have the start and end dates of the chart pattern graphed, the program will fill
in the appropriate prices. You'll have to enter the breakout price yourself or check the value pasted in earlier. The find button will calculate the height and select short or tall for you based on the
breakout price and pattern height. If you know how to do the calculation (which requires the median height as a percentage of the breakout price) then you can click Short or Tall yourself.
Proceed to Step 2, Yearly Price Range, and so on completing the form through step 11. If you click the Find buttons along the way, the calculation is done for you, making your job easier.
The score is updated along the way, and it appears on the form at 4. This pattern has a -6 score.
Here is more information about the other steps.
Step 3: Flat Base.
The glossary defines a flat base. "If you know what a rectangle chart pattern looks like, then you know what a flat base is.
Look for a price area in which the stock touches the same value multiple times over several weeks or months. The bottom or top of this area appears flat, hence the name.
Many chart patterns appear at a price just below the base, like a pothole in a road, before price takes off."
Step 4: Horizontal Consolidation Region.
From the glossary. "Is a congestion area marked by a flat top, flat bottom, (or both), or prices that share a common value. A HCR means any area in which price moves horizontally."
For the scoring system, you're only interesting in a horizontal consolidation region (think support or resistance) in the direction of the breakout, measured from the trend start to the
start of the chart pattern. For example, if the breakout is downward, you'll be looking for a support region (HCR) below the chart pattern and above the trend start (assuming the trend start
is also below the chart pattern).
Step 5: Trend Start.
From the glossary. "Where the price trend begins, as measured from a major price turning point. To determine the trend start,
look from the beginning of the chart pattern backward in time for the lowest valley or highest peak before which the stock rises or drops, respectively, at least 20%. The lowest low
or highest high represent where the trend starts. Whether to search for the lowest low or highest high, I use whichever drops below or rises above the bottom/top of the chart pattern
first (looking backward in time)." However, I often ignore any overshoot or undershoot that price makes in the two weeks immediately preceding the start of the chart pattern.
The find button on the form works well to locate the trend start. It ungrays after you enter the chart pattern's height. However, the computer stops the search for the trend start
after 6 months because a trend start before that point will be long term.
Step 6: Market Cap.
Small cap stocks are valued up to $1 billion. Mid caps are between $1 and $5 billion. Large cap stocks are above $5 billion.
Step 7: Breakout Direction.
If you don't know the breakout direction because price hasn't broken out of the chart pattern yet, select the direction you wish to trade.
Step 8: Volume Trend.
The Find button employs the slope of a line using linear regression on volume from the start to the end of the chart pattern. Sometimes you can tell the trend just
by looking at the chart's volume between the two vertical red lines (pattern's start and end).
Step 9: Breakout Day Volume.
Again, the Find button helps with the calculation. If price has not broken out of the chart pattern yet, assume light volume (answer No).
Step 10: Throwback/Pullback.
A throwback or pullback happens slightly more than half the time after the breakout from a chart pattern.
If no breakout has occurred, assume a throwback or pullback will occur.
Step 11: Breakout Day Gap.
If price hasn't broken out of the chart pattern yet, then assume a gap will not appear.
DISCLAIMER: The scoring system is a tool to help you select better performing chart patterns, but there is no guarantee. Some patterns will work better than others, regardless of the score. How you trade will determine success or failure. Your actual trading results will vary. Past performance doesn't guarantee future results. YOU ALONE ARE RESPONSIBLE FOR YOUR INVESTMENT DECISIONS. Please understand that the Score Form does NOT make recommendations as to which security you should trade.
Patternz: Seasonality Form
This is the Seasonality Form, new to version 7.4
This form allows you to check how far price might close higher or lower for any period of the year, based on historical performance.
For example, will the stock close higher on Tuesdays? Or how about in September, often
the weakest month of the year? What's the best time to buy, hold, and sell a stock during the year? This form answers those questions and others.
On the Main Form, select the file(s) you wish to examine and click the Seasonality menu option. This form will appear. Click Start or Auto to begin.
The box at 1 is a message box which appears after pressing the Auto button. It describes results found for Alcoa stock (AA.csv) in this example. You can read the message about what it finds.
Shown under the message box at 2 are some of the results for Alcoa and other stocks.
The other controls are self-explanatory but click the Help button on the form for detailed help or hover the mouse over most controls for a quick outline of its function.
Patternz: Setup Form
As of version 7.10, this is the Setup Form which you can access from the Chart Form by clicking the Setup button.
Select either a candlestick or open-high-low-close bar chart. New to version 7.6 are annotations. Check the box to show them on most charts. An annotation is a small box that tells you the price or volume where the mouse points.
These define aspects of the chart's colors. Click one of the five buttons to select a new color (even the black buttons say "Pick", although you can't see it) or Restore Defaults to
return the color settings to the factory presets.
This limits the number of decimals shown. For currencies, you may wish to change the 2 to a 4 or another value.
Check the box to show a moving average. When checked, the controls appear where you can select the type of moving average and the length, as shown in the figure.
This tells Patternz what to do with quotes which have no volume. Many times, 0 volume is a quote error, but not for mutual funds and maybe other security types. You may wish to chart (or not)
quotes with 0 volume days.
For gap patterns, this sets the minimum size used to detect a gap. A gap twenty cents tall is shown.
A few Patternz charts support target information. Select the type of information you wish to view on the charts. On the Chart Form,
select a chart pattern or candlestick listed (if any) from the list box (grid) on the lower left side.
Any targets associated with that pattern will be displayed, if possible to do so.
Show below targets. This acts as the master switch to turn on or off the display of targets. It is the same as the Chart form's Targets check box.
The Show confirmation check box draws a blue line for those chart patterns which require confirmation (price to close above or below the line) before they become a valid chart pattern. A blue line will appear at the confirmation price and will extend to the right until it hits price.
Show stop loss. The stop loss is based on volatility. Click the question mark button for more information. The stop loss appears as a violet line on the chart.
Show target price.. The 'measure rule' target is often the height of the pattern added to the top of the pattern or subtracted from the bottom of the pattern. It serves
as a minimum price move to expect. This website and some of my books tell how often price reaches the measure rule target. The line will appear as dark red.
Show ultimate high/low. The ultimate high or low is the highest peak or lowest valley after the breakout from a pattern before a 20% change in trend occurs. It serves as a proxy
for how well you might have done if you traded the security perfectly. The target appears as a gray line.
Up target % and Down target %. You can set target lines based on a percentage of the breakout price. Those targets appear as green lines.
Show target/stop only if not hit. This helps de-clutter the chart by removing targets the stock has already reached.
Include description. New to version 7.10, when this is checked, a short phrase accompanies the target lines. When unchecked, you only see colored lines on the chart.
I include this option for situations where the targets are close together and the descriptions merge into gibberish. You can remove the description and look for the colored lines only.
All button. Click this to check all associated check box targets.
Patternz: Simulator Form
Let me explain how I use the simulator.
I select double bottoms to trade but it doesn't matter much which pattern you use. I like to trade from the long side, hence, I use a bottom and double bottoms have easily seen
breakout prices (the top of the pattern).
If I see a setup I want to trade, I'll hit start, and when the program pauses, I'll click the 'Set Targets' button, then resume (or Clear if I want to skip the trade and just watch what happens).
The trade will unfold and it'll either work or not. If I repeat this procedure in many stocks, I'll begin to understand which setups will work (that is, the price path leading to the double bottom
suggests which trades will work and which ones won't).
Simulator Lesson 1
For example, look at the chart of Boeing (BA). Price rises and then moves sideways for a period. Following that, price drops and forms a double bottom (DB on the chart).
After seeing this setup repeatedly fail in the simulator, I know not to take the trade.
Indeed, the trade gets stopped out when price drops below the bottom of the double bottom.
I use the simulator to find those setups. If I have a real trade I want to make, I'll use the simulator to find similar setups and see how they worked in the past. That way, I'll
have more confidence entering a trade.
Simulator Lesson 2
Another way I use the simulator is to help determine how long to stay in the trade. In other words, to improve my exit timing.
Look at this chart of Bed Bath and Beyond (BBBY). The red DB (hard to see) is the double bottom which confirms as a valid chart pattern at the blue dot.
The blue dot shows where a buy triggered. The lavender dot shows the ultimate low (the lowest low during the trade before price rises at least 20%). The red dot shows the exit signal when
price has met the target. That red dot is based on the height of the double bottom (the measure rule).
Look how much profit the trade missed. Indeed, the stock continued to rise into January 2014 (not shown).
Exiting at the red-dot target meant a sale at 60.65. Holding on until reaching the ultimate high at 80.82 (not shown) would mean additional profit.
By using the simulator in this manner, you can teach yourself to trade chart patterns successfully (to become a more profitable discretionary trader). You'll be able to look at a chart
and say, "This trade will work" or "This one will fail" just by looking at how price has moved in the past.
The simulator isn't perfect. It doesn't include slippage, for example, and you'll know that a chart pattern will confirm because the only simulator finds confirmed patterns (mostly, anyway)
Using the Simulator
Shown above is the Simulator Form, new to version 7.13. (Not shown: Version 7.14 added a skip check box to skip stocks which do not show a chart pattern to trade).
To run the simulator, here are the steps.
Select a chart pattern to trade (C).
Click Start (left of C). The chart will appear (A) and the simulator will pause.
Fill in your price targets (B) for the chart pattern.
Click Resume (C, left).
The simulation begins. Change the speed by moving the scroll bar (C, bottom) left (faster) or right (slower).
You can Pause (C, left) the trade at any time or just let it go until the trade completes or it runs out of data.
Completed trades will be listed in the grid (not shown in this figure).
That's it. It's easy enough to use even through there are a number of controls you can play with. Here's more information about them.
This chart (A) shows a trade using a double bottom (DB). To the right of the double bottom (DB), notice the red, blue, and violet colored dots. Those mark buy, sell and ultimate low points. Not shown on this chart is a
grid of trades where the labels are color coded to the dots, making it easy to find your buy and sell points.
The help button at B explains the controls in this section. For each chart pattern, you can press the Set Targets bottom and it'll fill in the target, buy, and stop prices for you or
you can type in your own. During a trade, you can also press the Buy Now and Sell Now buttons to begin or end a trade.
A market order is assumed but you can use a limit order to trade by checking the associated check box. Long sided trades are assumed unless you click the Short Sale check box or click
the Sell Now button before buying.
At C, you select which chart pattern you wish to trade. If none appear, then there can be many causes. That stock may not have the requested chart pattern. The stock may have the
chart pattern but not on this scale (daily/weekly/monthly) or perhaps you just didn't select the chart pattern you're looking for. Click the Setup button (D) to change time scales or the Patterns
button (D) to select which chart patterns you're looking to trade.
Click the Start button to show the chart. It'll find the chart pattern and pause at the location of your choice (click the Setup button for your options). When you've picked your price
targets (B) and are ready to trade, then click Resume (NOT Start). Price bars will be fed into the simulator from the data file, the speed of which is set by the Speed scroll bar (C, bottom).
The Setup button has additional controls, so be sure to click it.
The form also has two help buttons plus when you hover the mouse over a control, you'll see a helpful phrase appear.
It does not add slippage to a trade (that is, trades will fill at the opening price, not 'near' the opening price). This also means you can reproduce a trade exactly, which is a good thing.
If the chart shows a pattern, chances are it'll confirm. Thus, you know you're trading a confirmed pattern.
Patternz: Splits and Dividends Form
This form is new to version 6.1. Access the form by clicking the Splits/Divs menu option on the Main Form.
The form shows stock splits and dividends for the securities you choose.
1. This is the help section.
2. Stock files are listed here. Select those you wish to find splits or dividends.
3. Results are shown here.
4. Select a quote provider.
5. Select splits, dividends, or both.
6. For a symbol not listed in 2, enter the symbol name here. It need not be a member of the portfolio.
7. You may need an API key or token to access the provider (4). Enter the token here. See the associated quote provider for a token/key.
8. Most of the buttons are self explanatory. Browse allows you to find the portfolio where stock files reside. Click Portfolio to easily switch from one portfolio to another.
Patternz: Update Form
WARNING: The first time I ran this version, it appeared to hang my machine. About 2 minutes after running the thing, my
virus software popped up and said Patternz was trying to access the internet. Duh. I approved the access and it's worked fine since.
The picture shows the Update Form, as of version 6.6
From the main menu, click the Update button to get here. The Update Form appears.
Here are brief descriptions of the controls.
This is where your stock (symbol) files, if any, will appear. Highlight the files you wish to update and click Start (7).
Start from last update: This option updates your quote files starting from the day after the last quote. If the markets are open, updating ends with the prior day. If the markets
are closed and data is available, the current day's quotes are included. Thus, you should wait a few hours for end of day data to be available.
Get historical quotes: This option replaces your quote files with new data. Specify the date range (6), any new symbols (5), and click Start (7). Use this option to keep your
quote files short. I recommend 2 years of data which will keep load and processing speed tolerable.
However, be advised that if you use this option, you may run out of free quotes (IEX, for example, will charge you oodles of "messages" for each stock). Select your data provider with care.
Select your quote provider. The ? buttons provide more information about some providers. On version 7.25, I changed the data vendors with a new set. See below for a comparison of vendors.
API key/Token: Most quote providers need an API key or token. Paste the token in the box provided (it will not be grayed for those services requiring a token, so click
Barchart, Finnhub.io, IEX, or Tiingo (3) first).
For historical quotes files only, enter a list of new symbols (5) you wish added to the list box (1). Separate each symbol with a space. If the text box is grayed, then click the Get
historical quotes radio button.
For historical quotes only, enter the start and end dates of the historical data you wish to download. To keep the program working fast, I suggest a maximum of about two years of data.
With some quote providers, the "To" box is ignored, so you'll get the "From" date to the current date.
The Update All Portfolios button updates stocks in each portfolio automatically. The Browse button allows you to find existing quote files. The Stop button halts a
download. The Start button begins a download. Select All highlights files shown in the list box (1). Help provides help for the form (as does hovering the mouse over a
control). The Done button returns the program to the Main Form.
This is the retry list box, new to version 6. If a symbol is not updated by a quote provider, it will be placed here. Select a new quote provider, highlight the symbols in the retry list box
you'd like updated, and click the Retry (3) button. The highlighted symbols will be sent to the new quote provider for update. Continue this procedure until all symbols in the retry list box have been removed. Note: if an unusual number of symbols appear in the retry list box, then it's possible that the day's quotes are not available by the quote provider. Sometimes, it'll take until the next day for quote information to become available.
New to version 6.6 is the Auto retry check box (also located near 3). Checking this will instruct the program to automatically retry the various quote providers should any quote
files still need updating. It works best if you have provided tokens for the various quote providers otherwise they will be skipped.
Error messages appear here.
Patternz: Data Vendor Comparisons
I changed some of the data providers in version 7.25. I removed Alpha Vantage because they are having legal problems and in my opinion, you should avoid using them. I also
removed google because they haven't worked for years. This review was done on 20 August 2020.
Not a good choice for getting historical quotes (because you can only get 6 months worth of data). To update existing quotes, it should work fine providing your quote files are not older than 6 months.
Not a good choice for getting historical quotes (because you can only get 1 year's worth of data). To update existing quotes, it should work fine providing your quote files are not older than 1 year. If you ask for more than 1 year of data, you get 1 day.
They allow up to 50,000 messages per month. Sounds like a lot but one historical download of 5 years duration will chew up about 13,000 messages. So this is really limiting. Not a good choice for historical quotes and to update existing quotes, you'll need to use it sparingly.
This is my data provider of choice. When yahoo was late or gave wrong data, I decided to buy a subscription to Tiingo. It's only $10 a month. But their free plan is generous, too. This is a good choice for both historical and to update existing quote files.
Data is sometimes dirty (bad information) or may not be available until the next day or not at all. It's a good free quote provider especially because you don't need an API key. This is a good choice for both historical and to update existing quote files.
Patternz: Installation Instructions
Follow these instructions to install Patternz.
Use the control panel to uninstall any old versions of Patternz.
Download Patternz to your machine by clicking the link at the top of this page (See Download Now).
Extract all files from the compressed folder and put them in a location of your choice. Note: MMM.csv is a sample data file containing stock quote information that Patternz can read.
Once installation completes, there should be a Patternz short cut on your desktop. Click that to run the program.
Versions 5.x (and more recent) of Patternz should work with Windows 7 and more recent operating systems. Patternz works on computers with a minimum screen size of 1024 x 768.
This version works best in the United States and for countries that use a similar date format. If your country has a different way of treating numbers (instead of 43.57, it's 43,57 for example)
or if your country trades on the weekend (Saturday or Sunday), then it might not work. Try it and see.
If you still want to use it despite a different format, then find the International settings ("Clock, Language, and Region") in the control panel and set your Formats (tab)
and Location (tab) to the United States. You'll need both the format and location.
Using Patternz the First Time
To use Patternz the first time, follow these instructions.
The first time you run Patternz, a license form will appear. Read the form and click that you accept or reject the terms. Click the Done button.
If you accept the terms, a message box appears that talks about the stock data files. Click OK.
The Browse For Folder dialog box appears. Select the location where you have placed your stock quote files or where you intend to place them. Let's call
the location you select the Patternz Folder.
Move the MMM.csv file from the extracted folder (see Installation Instructions above) to the Patternz folder. The MMM.csv file contains sample stock
data which Patternz can use to find chart patterns. You do NOT have to move the file, but it's helpful if Patternz has at least one stock file to use.
After you click OK from the Browse For Folder, the Main Form appears. If you have stock data files, they will appear in the list box. If you HAVE data files but they
do not appear in the list, then click the Browse Portfolio Location button to locate your data files. Only files with .csv or .txt extensions will appear in the list.
If you moved MMM.csv to the Patternz folder, it should be listed. Metastock, Mt4, or other file types are not supported.
If you do NOT have any stock data files, then click Update and read the instructions (below) for that form to download quote files.
Return to the Main Form.
Select a stock symbol listed and click Chart. Patternz will read the file and display it with patterns highlighted on the Chart Form.
Once Patternz is setup, select stock files you wish to view and click the Chart button to view them.
On the chart form, when using the chart,
Depressing the left mouse button will show crosshairs as long as the button is pressed.
Right clicking on a price or volume bar will show price or volume information for that date. The price information will be adjusted for splits and dividends but not the volume bars.
Right clicking the white area (that is, NOT on a price or volume bar) and dragging the mouse will draw a trendline until you release the button or go off the chart. Cool, huh?
Pressing the + or - keys in the number pad area (not the area where $ % ^ and such are located) of your keyboard will load the next (+) or previous (-) stock file.
On the Main and Update Forms, highlight a stock symbol in the list box. Press the Delete key to remove both the symbol and the associated stock file from your computer. Press F2 to rename a symbol.
Where do I get the symbols from?
You'll have to use the Internet to search for symbols of your favorite companies. If you want the S&P 500 symbols, I downloaded them and made them compatible with Patternz
(meaning I removed everything except the symbol names and separated them by one space).
Here's the list. I'm not guaranteeing that the list is correct, but it's one I found and it's a good starting point.
Once you have your symbols, go to the Update form. Click the 'Get historical quotes' option button to ungray the 'New symbol(s), space separated' list and paste them (or type them) in. Then run an update using the provider of your choice (Google stopped working long ago, yahoo is flakey, Alpha Vantage is slow. Tiingo is my favorite choice, but you'll need a token). The symbols and quote information (Don't forget to set the From and To dates) will be added to the program.
Common Patternz Problems
Some machines may not allow the installation of Patternz. First, install the program after logging in as the administrator. Then pray. Also, your virus check may take a long time (a minute)
before asking if you really want to install Patternz. We're not sure why some machines won't allow installation, but suspect it's a permissions (login as administrator) problem.
Check the zip file and see if there's a Patternz.exe file there. If so, copy that to your hard drive and see if it'll run. That skips the install process.
Update Form: No Internet Access
If you are using the Update Form to get quotes and it reports that the internet may be unavailable, then check your anti-virus/security software. It may be blocking
Patternz's access to the internet.
Update Form: Cannot Download Anything
You have internet access and you've tried all of the quote providers, but still Patternz won't download anything. One user had that problem.
Delete Patternz from the registry by following the steps here.
Update Form: Update Errors
If Patternz cannot update a quote file, it is placed in the Retry list box. Select another quote provider, click Retry, and see if you can download the symbol.
If you are downloading a lot of files (such as most of the market), be aware that stock symbols change from time to time. It's possible that you'll need to change or delete the
To change a symbol, on the Update or Main Forms, click the symbol you wish to change and click F2 on your keyboard. Change the symbol's name and click OK.
To delete a symbol, on the Update or Main Forms, click the symbol and press Delete on your keyboard and then click OK. WARNING: This will delete the associated symbol file.
Chart Form: Quote Errors
The program will check for bad quotes, such as the high price being reported as below the low price or the opening price is zero. It counts these errors and reports them on
the clipboard. So if you are using the Chart Form, for example, and see quote errors, paste the clipboard information into notepad.exe or other program and read what it says.
If you see a lot of quote errors, then that's a symptom of a corrupt file. See Step 2.
It's also possible that you have received bad quote information. The quote providers (Google, yahoo, and so on) distribute incorrect quote data from time to time, so seeing quote
errors is not unusual. You may wish to select another quote provider and use the 'Get historical quotes' option to replace your quote files. See Step 2.
Chart Form: Chart Looks Wrong
1. If you chart a symbol and the chart looks incorrect (you can use Bigcharts.com or
another online source to compare charts), then the symbol file(s) might be corrupt. This
can happen if you didn't replace your quote files when switching to a new version from one before 6.0.
2. To replace bad or corrupted quote files, go to the Update form, click Select All (to highlight all quote files), click 'Get historical quotes', fill in the
'From' and 'To' dates (a two-year span works well. Longer files can slow the program) and then click Start*. The files will be replaced.
*Make sure you replace all quote files. If you have multiple portfolios, then click 'Update All Portfolios' instead of Start.
3. If you see lots of quote errors, then that's another symptom of a corrupt file. See the prior step to replace your quote files. However, read Quote Errors
Remove any .txt or .csv files from the folder where your quote files reside. For example, if you have the 'READ ME.txt' file left over from installation in the folder
where you keep the symbol files, then either move or remove that txt file. Otherwise, the program will think it's a symbol and try to use it, causing an error.
Most users can use the Update Form now without any need to use the File Format Form. If you provide your own quote files (such as csv (ASCII) files through Metastock) then use the File Format Form
to setup the symbol file configuration. Do NOT use the Update form.
For everyone else, use the Update Form and do NOT use the File Format Form.
Switching from using the File Format Form to the Update Form, or the reverse (Update to File Format), will likely cause problems or even a crash.
Most forms have a Help button, so click that and read the information.
Take the Tour and learn about the program's features.
When All Else Fails
If nothing else works, delete Patternz from the registry and run the program again. To do that, follow these steps.
Run Patternz and go to the Main Form (the first form that loads)
Click the Help MENU option
Click Remove Patternz
Click Delete Patternz from Registry
Exit the program and then run it again. See if that corrects the problem.
Patternz: Known Bugs
As of version 7.5 (found 12/26/18), I believe I still have a problem with updating stock quotes. I noticed a duplicate crept in
while using yahoo and 'start from last update' option on the Update Form. I did an update on 12/14 then another on 12/26, before the
market opened. That created a duplicate...I think. Or it could be yahoo is passing bad data when a holiday is involved.
To fix, switch to 'Get historical quotes' on the update form.
Patternz Release Notes, Old Versions
Links to the old versions appear in blue below. They are compressed files (.zip). Unzip them and follow a regular install.
This is an informal release. A user reported that downward gaps are not appearing so I tracked down the bug and fixed it. The above link is a zip file of the .exe program.
Hunt down the existing Patternz.exe and replace it with this one. When I make the next formal release, it'll be version 7.28.
Made a small change to cup with handle to find more patterns.
Fixed a bug with unconfirmed cup with handle patterns and targets.
I'm working on improving the Seasonality form. Auto will now scan all files.
Added pattern start and end dates to Simulator Form grid results.
Changed Relative Strength form so that if you have missing quote data, it'll still give results.
BarChart is no longer offering free quotes as of 12/31/2020, so it has been disabled.
I made a change to the CPI form so that the red and green candles will appear like they used to.
Please note: Version 6.8 and 6.9 allow you to change candle colors from what used to be red/green (on any chart) to the new default of black/white. Go to the Chart Form,
Setup button, and select the colors of your choice there.
I reworked the program to make it easier to use. The File Format form is no longer needed. Simply go to the Update form and use one of the quote providers to download your stock symbols.
With this version, you can change from one quote provider to another without having to replace your quote files.
For users with older versions of Patternz, you MUST use the "Get historical quotes" radio button on the update form to replace existing files. You only need to do this once.
I suggest limiting the file length to 2 years of data. That keeps the load and processing times short.
I updated the help screens and added code to remove repetitive messages when things go wrong (List and Indicator forms).
Yahoo quotes have a bug where the quotes are not adjusted for dividends. Thus, the close will be below the day's low and the chart will be wrong. Fixed in next release. Use google/quandl
quotes instead. Note: Google/Quandl are not longer available.
This should fix the problem with version 5.4. It's more robust, too, but use notebook or excel after about a week's worth of use to check your data files. Make sure the
dates are in ascending or descending order and nothing looks corrupted. If corrupted, send the file to me and use the "Get historical quotes" option to replace your files.
This version has a change when using "Get historical quotes" on the Update Form. Versions 5.4 and 5.5 only updated symbols in the symbol text box OR the list box, but not both (and in that order).
Version 5.6 will do both.
Numerous bug fixes. I discovered that some triangles will cause a divide by 0 error when charting. Plus, the information in the grid (breakout date, direction, targets and so on) could be wrong.
I split adjusted volume and no one else appears to do that. This version corrected that. I added a LIST feature, so you can get details on chart patterns and copy them to Excel or other
program for analysis.