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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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Picture of Bumper.
Picture of the head's law.
Chart Patterns: After the Buy
Getting Started in Chart Patterns, Second Edition book.
Trading Basics: Evolution of a Trader book.
Fundamental Analysis and Position Trading: Evolution of a Trader book.
Swing and Day Trading: Evolution of a Trader book.
Visual Guide to Chart Patterns book.
Encyclopedia of Chart Patterns 2nd Edition book.

Bulkowski’s Pipe Tops

Class Elliott Wave Fundamentals Psychology Quiz Research Setups Software Tutorials More...
Candles Chart
Small Patterns
Industrials (^DJI):
Transports (^DJT):
Utilities (^DJU):
Nasdaq (^IXIC):
S&P500 (^GSPC):
As of 04/20/2018
24,463 -201.95 -0.8%
10,579 -92.91 -0.9%
691 -5.96 -0.9%
7,146 -91.93 -1.3%
2,670 -22.99 -0.9%
Tom's Targets    Overview: 04/13/2018
25,300 or 23,400 by 05/01/2018
10,800 or 9,800 by 05/01/2018
670 or 710 by 05/01/2018
7,400 or 6,800 by 05/01/2018
2,750 or 2,600 by 05/01/2018

Written by and copyright © 2005-2018 by Thomas N. Bulkowski. All rights reserved. Disclaimer: You alone are responsible for your investment decisions. See Privacy/Disclaimer for more information.

For more information on this pattern, read Encyclopedia of Chart Patterns Second EditionEncyclopedia of Chart Patterns 2nd Edition book., pictured on the right, pages 550 to 562.

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Pipe tops are good performers in both bull and bear markets. They shine once price reaches bottom and rebounds (over 50% average climb but that's for perfect trades), so if you can tell when the downward price trend has stopped, buy. Discovered by Thomas Bulkowski in 1998.

Pipe top chart pattern
Pipe Top Pattern


Pipe Top Important Bull Market Results

Overall rank: 4 out of 21
Break even failure rate: 11%
Average decline: 20%
Pullback rate: 41%
Percentage meeting price target: 70%

The above numbers are based on hundreds of perfect trades. See the glossary for definitions.

Pipe Top Identification Guidelines

Weekly chartPipes appear on the daily scale but the ones on the weekly charts perform better. Use the weekly chart.
Price trendUpward leading to the pattern.
ShapeTwin and adjacent upward spikes. On a bar chart, the two price bars look like spikes. On a candlestick chart, the candles can be any shape (from doji to Marubozu). In other words, don't let the term spike mislead you.
SpikesThe spikes should be longer than most others in the past year. Longer is better. They should tower over the surrounding price landscape.
OverlapThe spikes should have a large price overlap.
VariationThe price variation between tops is usually small but can vary up to $1 or more for high price stocks. The average difference is 21 cents.
VolumeThe right spike has lower volume 62% of the time when compared to the left spike.
ObviousThe pipe should stand-alone and be obvious on the chart.
RetraceThe best performing pipes appear at the top of a retrace in a prolonged downtrend.
ConfirmationThe pattern confirms when price closes below the lowest price in the pattern.
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Pipe Top Trading Tips

Trading TacticExplanation
Measure ruleCompute the height of the pattern from the highest high (point B in the Measure Rule figure to the right) to the lowest low (A) then multiply it by the above “percentage meeting price target.” Subtract the difference from the lowest price in the pattern (A) to get a price target (C).
DowntrendsThe best performing pipes occur during downtrends. Price bounces upward, forms a pipe, and then continues the decline.
TrendsAvoid pipes that appear after a long downtrend. The pipe may signal the end of the trend.
Lower left spikePipes with a lower left spike top tend to perform better. The Spike figure to the right shows an example of a lower left spike A compared to B.
Yearly lowPipes with breakouts within a third of the yearly low show the best performance.
PullbacksPullbacks hurt performance.
Pipe top measure rule
The Measure Rule

Pipe top spike


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Pipe Top Example

Pipe top chart pattern example

The above figure shows an example of a pipe top in the midst of a downward price trend. This is an example of the preferred setup, where a pipe top occurs when price is trending downward. The chart shows that price dropped from a low of about 8 to below 6.

-- Thomas Bulkowski

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See Also

Written by and copyright © 2005-2018 by Thomas N. Bulkowski. All rights reserved. Disclaimer: You alone are responsible for your investment decisions. See Privacy/Disclaimer for more information. 56k baud makes you want to get out and push!