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Thomas Bulkowski’s successful investment activities allowed him to retire at age 36. He is an internationally known author and trader with 30+ years of stock market experience and widely regarded as a leading expert on chart patterns. He may be reached at

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Bulkowski's Trendiness

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Busted
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Market
Industrials (^DJI):
Transports (^DJT):
Utilities (^DJU):
Nasdaq (^IXIC):
S&P500 (^GSPC):
As of 02/24/2017
20,822 11.44 0.1%
9,422 86.07 0.9%
699 10.33 1.5%
5,845 9.80 0.2%
2,367 3.53 0.1%
YTD
5.4%
4.2%
6.0%
8.6%
5.7%
Tom's Targets    Overview: 02/14/2017
21,150 or 20,000 by 03/15/2017
8,800 or 9,700 by 03/01/2017
700 or 640 by 03/01/2017
5,950 or 5,650 by 03/01/2017
2,400 or 2,260 by 03/01/2017
Indus strength: None YTD
Mutt Losers: None YTD
Mutt Winners: None YTD

Written by and copyright © 2005-2017 by Thomas N. Bulkowski. All rights reserved. Disclaimer: You alone are responsible for your investment decisions. See Privacy/Disclaimer for more information.

This article discusses trendiness. What is trendiness? It describes how often price trends after the breakout from a chart pattern.

This type of information is most useful for swing traders because they want to catch the move after the breakout when price begins to trend. The below rankings will help swing traders select chart patterns that typically lead to strong trends.

Trendiness Summary

I measured the move from the close the day before a chart pattern breakout to the first minor high or minor low. These are typically short moves before a throwback or pullback occurs.

The top performing chart patterns with upward breakouts are (click on the link for more information):

  1. Flag, high and tight
  2. Flag
  3. Diamond bottom
  4. Pennant
  5. Rectangle bottom

For downward breakouts, the best decliners are (click on the link for more information):

  1. Diamond bottom
  2. Inverted cup with handle
  3. Big W
  4. Scallop, descending
  5. Rounding top

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Trendiness Background

Several years ago, I received an email asking about an idea called trendiness. That is, which chart patterns result in price trending after the breakout?

I did some research to answer that question and this article shares those results.

Trendiness Methodology

I used my database of chart patterns and scanned it for confirmed patterns that dated as far back as April 1989 and as recent as October 2011 (I conducted the study on June 27, 2012). I found 37,594 patterns.

For each pattern, I found the nearest minor high or minor low after the breakout. To do that, I found the first minor high that was above any higher peak within five days (five days before to five days after, for a total of 11 days). The same applied to minor lows -- the lowest low within five days (11 days total).

Then, I measured the price change from the closing price the day before the breakout (to catch any breakout day gaps) to the high at the minor high or the low at the minor low.

I averaged the results for each pattern type and show those below.

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Trendiness: Upward Breakout Results

The following table shows the results for upward breakouts only. Low sample counts are shown highlighted in red. Distrust the associated performance.

Trends From Upward Breakouts in Chart Patterns
RankGainSamplesPattern
Best30.57%520Flag, high and tight
215.77%373Flag
313.96%267Diamond bottom
412.80%450Pennant
512.50%375Rectangle bottom
612.42%464Rounding bottom
712.21%759Double Bottom, Eve and Eve
811.84%522Three Rising Valleys
911.76%772Double Bottom, Adam and Adam
1011.71%764Triangle, descending
1111.70%740Double Bottom, Adam and Eve
1211.66%532Falling wedge
1311.45%1,605Head-and-shoulders bottom
1411.44%968Triple bottom
1511.39%844Scallop, ascending and inverted
1611.37%183Diamond top
1711.28%478Double Bottom, Eve and Adam
1810.97%209Broadening top, right-angled and ascending
1910.95%1,138Scallop, ascending
RankGainSamplesPattern
2010.94%405Rounding top
2110.94%532Bump-and-run reversal, bottom
2210.64%509Broadening wedge, descending
2310.58%1,811Triangle, symmetrical
2410.20%642Rectangle top
2510.17%375Scallop, descending
269.88%501Cup with handle
279.42%487Head-and-shoulders complex bottom
289.41%218Big W
299.40%507Broadening top
309.16%273Broadening bottom
319.11%566Ugly double bottom
328.95%1,057Triangle, ascending
338.93%128Broadening wedge, ascending
348.73%265Broadening top, right-angled and descending
358.56%33Roof
368.33%101Roof, inverted
Worst7.89%403Rising wedge
RankGainSamplesPattern

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Trendiness: Downward Breakout Results

The following table shows the results for downward breakouts only. Low sample counts are shown highlighted in red. Distrust the associated performance.

Trends From Downward Breakouts in Chart Patterns
RankLossSamplesPattern
1-21.58%109Diamond bottom
2-15.91%433Inverted cup with handle
3-15.71%92Big W
4-15.53%728Scallop, descending
5-15.13%360Rounding top
6-14.78%312Flag
7-14.30%151Broadening wedge, descending
8-13.87%529Three Falling Peaks
9-13.04%786Double Top, Eve and Eve
10-12.75%262Falling wedge
11-12.69%198Broadening bottom
12-12.52%545Double Top, Adam and Adam
13-12.42%776Bump-and-run reversal, top
14-12.31%317Diamond top
15-12.27%505Double Top, Adam and Eve
16-12.23%298Pennant
17-11.72%450Head-and-shoulders complex top
18-11.71%501Double Top, Eve and Adam
RankLossSamplesPattern
19-11.70%740Scallop, descending and inverted
20-11.66%1,034Triple top
21-11.13%1,677Head-and-shoulders top
22-11.13%100Roof, inverted
23-10.88%338Rectangle bottom
24-10.73%856Triangle, descending
25-10.51%282Scallop, ascending
26-10.24%348Broadening top, right-angled and ascending
27-10.05%430Broadening top
28-9.94%1,287Triangle, symmetrical
29-9.49%331Rectangle top
30-9.34%592Triangle, ascending
31-9.30%51Cup with handle
32-9.20%170Roof
33-9.12%746Rising wedge
34-8.40%193Broadening top, right-angled and descending
35-7.70%271Broadening wedge, ascending
RankLossSamplesPattern

-- Thomas Bulkowski

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See Also

Written by and copyright © 2005-2017 by Thomas N. Bulkowski. All rights reserved. Disclaimer: You alone are responsible for your investment decisions. See Privacy/Disclaimer for more information. On a clear disk, you can seek forever.