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Written by and copyright © 2005-2013 by Thomas N. Bulkowski. All rights reserved.
For more information on this pattern, read
Encyclopedia of Chart Patterns, Second Edition  ,
pictured on the right, pages 115 to 131. That chapter gives a complete review of the chart pattern, including tour, identification guidelines, focus on failures, performance statistics, trading tactics, and sample trade. Below is just a sliver of the information contained in the book.
Horn tops are H-shaped chart patterns that perform best when found on the weekly charts. The
performance is very good, especially in a bull market. Horn tops tend to hide in a bear market. Discovered by Thomas
Bulkowski in 1998.
Important Bull Market Results for Horn Tops
Overall performance rank (1 is best): 4 out of 21
Break even failure rate: 7%
Average decline: 21%
Pullback rate: 33%
Percentage meeting price target: 70%
The above numbers are based on hundreds of perfect trades. See the glossary for definitions.
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Horn Top Identification Guidelines
| Characteristic | Discussion |
| Weekly chart | Use the weekly chart to locate horns. |
| Price trend | Upward leading to the pattern. |
| Shape | Looks like a steer's horn, two parallel price spikes separated by a week. |
| Spikes | The spikes should be longer than most in the past year. They should tower over the surrounding price landscape. |
| Uptrend | The best performing horns appear at the end of a long uptrend. |
| Confirmation | The pattern confirms as valid when price closes below the lowest price in the 3-week pattern. |
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Horn Top Trading Tips
| Trading Tactic | Explanation |
| Measure rule | See the Measure Rule figure to the right. Compute the
height between the highest high (A) and lowest low
(B) in the 3-week pattern and then multiply
it by the above “percentage meeting price target.” Subtract the result
from the lowest low (B) in the pattern to get
a price target (C). |
| Uptrends | The best performing horns appear at the top of uptrends lasting several months in duration. |
| Downtrends | If the horn appears near the end of a downtrend, then avoid it. |
| Volume | Below average volume on both spikes suggests better postbreakout performance. |
| Confirmation | Wait for confirmation before placing a trade. |
| Trend change | A horn top usually signals a trend change within 2 months. |
| Outside week | When the right horn spike (AB
in the Outside Week figure to the right) is outside (a higher high and lower low)
the price range of the left spike CD), performance
improves. |
| Pullbacks | Pullbacks hurt performance. |
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 The Measure Rule
Outside Week
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Horn Top Example
The above figure shows an example of a horn top chart pattern. The two spikes tower above the surrounding price
landscape, the trend to the chart pattern is upward and long, and price confirms the horn top when it closes below
the lowest low in the 3-week pattern. Shown on the weekly scale.
-- Thomas Bulkowski
Copyright © 2005-2013 by Thomas N. Bulkowski. All rights reserved. The name is Baud...James Baud.
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