As of 08/23/2019
  Indus: 25,629 -623.34 -2.4%  
  Trans: 9,740 -333.41 -3.3%  
  Utils: 832 -8.66 -1.0%  
  Nasdaq: 7,752 -239.62 -3.0%  
  S&P 500: 2,847 -75.84 -2.6%  
YTD
 +9.9%  
 +6.2%  
 +16.7%  
 +16.8%  
 +13.6%  
  Targets    Overview: 08/15/2019  
  Up arrow27,200 or 24,900 by 09/01/2019
  Up arrow10,700 or 9,550 by 09/01/2019
  Up arrow850 or 790 by 09/01/2019
  Up arrow8,200 or 7,400 by 09/01/2019
  Up arrow3,000 or 2,750 by 09/01/2019
As of 08/23/2019
  Indus: 25,629 -623.34 -2.4%  
  Trans: 9,740 -333.41 -3.3%  
  Utils: 832 -8.66 -1.0%  
  Nasdaq: 7,752 -239.62 -3.0%  
  S&P 500: 2,847 -75.84 -2.6%  
YTD
 +9.9%  
 +6.2%  
 +16.7%  
 +16.8%  
 +13.6%  
  Targets    Overview: 08/15/2019  
  Up arrow27,200 or 24,900 by 09/01/2019
  Up arrow10,700 or 9,550 by 09/01/2019
  Up arrow850 or 790 by 09/01/2019
  Up arrow8,200 or 7,400 by 09/01/2019
  Up arrow3,000 or 2,750 by 09/01/2019

Bulkowski's Measure Rule

 

My book, Encyclopedia of Chart Patterns Second EditionEncyclopedia of Chart Patterns 2nd Edition book., pictured on the left, has the measure rule statistics for most of the 63 chart and event patterns covered by the book.

If you click on the above link and then buy the book (or anything) while at Amazon.com, the referral will help support this site. Thanks.

-- Tom Bulkowski

$ $ $

Use the measure rule to predict a price target. The rule varies from chart pattern to pattern as the below table shows. Usually the measure rule is the height added to (upward breakouts) or subtracted from (downward breakouts) the breakout price.

Unfortunately, that formula doesn't work well. Instead, multiply the height by the "percentage meeting price target," which I show in the below table as percentages. The result should be a closer and more accurate price target.

For example, if a broadening top has a high price of 25 and a low of 20 with a breakout of 22, an upward breakout target in a bull market would be B + ((H - L) * 62%) = 22 + ((25 – 20) * 62%) = $ 25.10. A downward breakout in a bull market would use the formula B - ((H - L) * 37%) = 22 – ((25 – 20) * 37%) = $ 20.15.

The formula may look complex but it's not. Anyone with a doctorate in mathematics can figure it out in a few hours.

-- Thomas Bulkowski

Notes:

B = The breakout price which is where price pierces a trendline.
CBG = The closing price before a gap.
CPH = The highest price in the corrective phase.
CPL = The lowest price in the corrective phase.
H = Price of the highest peak in the chart pattern
L = Price of the lowest valley in the chart pattern
H – L is the price of the highest peak minus the price of the lowest valley.
HL = Lowest price in the head.
HH = Highest price in the head.
NL = Neckline, measured vertically from the peak or valley in the head.
RL = Price of the right saucer lip.

Measure Rule in Bull Markets

Bull Market Chart PatternThe Measure Rule
Broadening Bottoms, down breakoutB - ((H – L) * 44%)
Broadening Bottoms, up breakoutB + ((H – L) * 59%)
Broadening Formations, Right-Angled and Ascending, down breakoutL - ((H – L) * 32%)
Broadening Formations, Right-Angled and Ascending, up breakoutB + ((H – L) * 68%)
Broadening Formations, Right-Angled and Descending, down breakoutB - ((H – L) * 44%)
Broadening Formations, Right-Angled and Descending, up breakoutH + ((H – L) * 63%)
Broadening Tops, down breakoutB - ((H – L) * 37%)
Broadening Tops, up breakoutB + ((H – L) * 62%)
Broadening Wedges, Ascending, down breakoutLowest low or B - ((H – L) * 58%)
Broadening Wedges, Ascending, up breakoutB + ((H – L) * 69%)
Broadening Wedges, Descending, down breakoutB - ((H – L) * 36%)
Broadening Wedges, Descending, up breakoutHighest high or B + ((H – L) * 79%)
Bump-and-Run Reversal Bottoms, up breakoutHighest high or B + ((H – L) * 68%)
Bump-and-run Reversal Tops, down breakoutB - ((Lead-in height) * 78%)
Cup-with-Handle, up breakoutB + ((H – L) * 50%)
Cup-with-Handle, Inverted, down breakoutB - ((Handle height) * 47%)
Diamond Bottoms, down breakoutB - ((H – L) * 63%)
Diamond Bottoms, up breakoutB + ((H – L) * 81%)
Diamond Tops, down breakoutB - ((H – L) * 76%)
Diamond Tops, up breakoutB + ((H – L) * 69%)
Double Bottoms, Adam & Adam, up breakoutH + ((H – L) * 66%)
Double Bottoms, Adam & Eve, up breakoutH + ((H – L) * 66%)
Double Bottoms, Eve & Adam, up breakoutH + ((H – L) * 66%)
Double Bottoms, Eve & Eve, up breakoutH + ((H – L) * 67%)
Double Tops, Adam & Adam, down breakoutL - ((H – L) * 72%)
Double Tops, Adam & Eve, down breakoutL - ((H – L) * 69%)
Double Tops, Eve & Adam, down breakoutL - ((H – L) * 72%)
Double Tops, Eve & Eve, down breakoutL - ((H – L) * 73%)
Flags, down breakoutFlag high - ((Flagpole height) * 47%)
Flags, up breakout Flag low + ((Flagpole height) * 64%)
Flags, High and Tight, up breakoutB + (Half the rise leading to flag top)
GapsNone
Head-and-Shoulders Bottoms, up breakoutB + ((NL – HL) * 74%)
Head-and-Shoulders Bottoms, Complex, up breakout B + ((NL – HL) * 74%)
Head-and-Shoulders Tops, down breakoutB - ((HH - NL) * 55%)
Head-and-Shoulders Tops, Complex, down breakoutB - ((HH - NL) * 53%)
Horn Bottoms, up breakoutH + ((H – L) * 76%)
Horn Tops, down breakoutL - ((H – L) * 70%)
Islands Reversals, down breakoutL - ((H – L) * 62%)
Islands Reversals, up breakoutH + ((H – L) * 69%)
Islands, Long, down breakoutCBG - ((H – L)/2 * 78%)
Islands, Long, up breakoutCBG + ((H – L)/2 * 82%)
Measured Move Down (second leg target)CPH - ((H – CPL) * 35%)
Measured Move Up (second leg target)CPL + ((CPH - L) * 45%)
Pennants, down breakoutPennant high - ((Flagpole height) * 51%)
Pennants, up breakoutPennant low + ((Flagpole height) * 60%)
Pipe Bottom, up breakoutH + ((H – L) * 83%)
Pipe Tops, down breakoutL - ((H – L) * 70%)
Rectangles Bottoms, down breakout L - ((H – L) * 50%)
Rectangles Bottoms, up breakoutH + ((H – L) * 85%)
Rectangles Tops, down breakoutL - ((H – L) * 63%)
Rectangles Tops, up breakoutH + ((H – L) * 80%)
Rounding Bottoms, up breakoutRL + ((RL – L) * 57%)
Rounding Tops, down breakoutRL - ((H - RL) * 24%)
Rounding Tops, up breakoutH + ((H - RL) * 61%)
Scallops, Ascending, down breakout L - ((RL – L) * 25%)
Scallops, Ascending, up breakoutRL + ((RL – L) * 58%)
Scallops, Ascending and Inverted, up breakoutH + ((H – L) * 61%)
Scallops, Descending, down breakout L - ((H – L) * 30%)
Scallops, Descending, up breakoutRL + ((H – L) * 35%)
Scallops, Inverted and Descending, down breakoutL - ((H – L) * 38%)
Three Falling Peaks, down breakoutL - ((H – L) * 33%)
Three Rising Valleys, up breakoutH + ((H – L) * 58%)
Triangles, Ascending, down breakoutB - ((H – L) * 68%)
Triangles, Ascending, up breakoutH + ((H – L) * 75%)
Triangles, Descending, down breakout L - ((H – L) * 54%)
Triangles, Descending, up breakoutB + ((H – L) * 84%)
Triangles, Symmetrical, down breakoutB - ((H – L) * 48%)
Triangles, Symmetrical, up breakoutB + ((H – L) * 66%)
Triple Bottoms, up breakoutH + ((H – L) * 64%)
Triple Tops, down breakoutL - ((H – L) * 40%)
Wedges, Falling, down breakoutB - ((H – L) * 30%)
Wedges, Falling, up breakoutHighest high or B + ((H – L) * 70%)
Wedges, Rising, down breakoutLowest low or B - ((H – L) * 46%)
Wedges, Rising, up breakoutB + ((H – L) * 58%)

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See Also

 

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:      New                  Bumper's Story Head's Law

Chart Patterns: After the Buy Getting Started in Chart Patterns, Second Edition Trading Basics Fundamental Analysis and Position Trading Swing and Day Trading Visual Guide to Chart Patterns Encyclopedia of Candlestick Charts Encyclopedia of Chart Patterns 2nd Edition Trading Classic Chart Patterns

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