As of 04/21/2021   Indus: 34,137 +316.01 +0.9%     Trans: 15,040 +145.39 +1.0%     Utils: 927 -6.07 -0.7%     Nasdaq: 13,950 +163.95 +1.2%     S&P 500: 4,173 +38.48 +0.9% YTD  +11.5%    +20.3%    +7.2%    +8.2%    +11.1% Overview: 04/15/2021     34,800 or 32,900 by 05/01/2021   15,200 or 14,000 by 05/01/2021   950 or 885 by 05/01/2021   15,000 or 12,900 by 05/01/2021   4,400 or 3,900 by 05/01/2021 CPI (updated daily): on 3/25/21
 As of 04/21/2021   Indus: 34,137 +316.01 +0.9%     Trans: 15,040 +145.39 +1.0%     Utils: 927 -6.07 -0.7%     Nasdaq: 13,950 +163.95 +1.2%     S&P 500: 4,173 +38.48 +0.9% YTD  +11.5%    +20.3%    +7.2%    +8.2%    +11.1% Overview: 04/15/2021     34,800 or 32,900 by 05/01/2021   15,200 or 14,000 by 05/01/2021   950 or 885 by 05/01/2021   15,000 or 12,900 by 05/01/2021   4,400 or 3,900 by 05/01/2021 CPI (updated daily): on 3/25/21

# Bulkowski on Consecutive Higher/Lower Closes

Released 3/18/2020.

## Consecutive Closes: Tutorial

Below is a slider quiz/tutorial to test your knowledge of consecutive higher or lower closes leading to a chart pattern breakout. Captions appear below the pictures in red for guidance, so be sure to scroll down far enough to read them. For more information on these findings, click: this link.

1 / 6
Imagine you're considering buying the symmetrical triangle chart pattern shown here, outlined with two converging straight lines. Price leading to the upward breakout (A) closes higher four days in a row. I show that in the inset (B) with four red dots. Do four consecutive up closes mean price is more likely to throwback? By that, I mean the move from A to C, where the stock returns to the breakout price shortly after the breakout. The next slide provides the answer.
2 / 6
Is a throwback more likely? No. In fact, consecutively higher closes leading to the breakout are a good indicator that a retrace will not occur. Does the same trend apply to downward breakouts? Yes. More than three consecutive lower closes leading to a downward breakout means a pullback is less likely. What about performance? See the next slide.
3 / 6
Given the same situation, is the move from A to C shorter than it is otherwise? To put it another way, does performance suffer after 3 consecutive higher or lower closes leading to a breakout? The next slide provides the answer.
4 / 6
Does performance suffer? No. Post-breakout performance is better if price closes higher/lower consecutively more than 3 days leading to the breakout, especially if the breakout is downward (that is, expect a larger decline after 3 consecutive lower closes). What about failures? See the next slide.
5 / 6
Given the same setup, does price fail more often than normal? That is, instead of continuing upward, price drops like that shown from A to C. The next slide provides the answer.
6 / 6
Do failures occur more often if price closes consecutively higher/lower more than 3 days leading to the breakout? No. Failures occur half as often for upward breakouts, but only see a slight improvement after downward breakouts. For more information on these findings, click: this link.

Support this site! Clicking any of the books (below) takes you to Amazon.com. If you buy ANYTHING while there, they pay for the referral.

 My novels: