As of 09/18/2020
  Indus: 27,657 -244.56 -0.9%  
  Trans: 11,432 -120.44 -1.0%  
  Utils: 798 -12.86 -1.6%  
  Nasdaq: 10,793 -117.00 -1.1%  
  S&P 500: 3,319 -37.54 -1.1%  
YTD
-3.1%  
 +4.9%  
-9.2%  
 +20.3%  
 +2.7%  
  Targets    Overview: 09/14/2020  
  Up arrow29,400 or 26,700 by 10/01/2020
  Up arrow11,750 or 10,600 by 10/01/2020
  Up arrow845 or 775 by 10/01/2020
  Up arrow11,800 or 10,400 by 10/01/2020
  Up arrow3,600 or 3,200 by 10/01/2020
CPI (updated daily): Arrows on 8/18/20
As of 09/18/2020
  Indus: 27,657 -244.56 -0.9%  
  Trans: 11,432 -120.44 -1.0%  
  Utils: 798 -12.86 -1.6%  
  Nasdaq: 10,793 -117.00 -1.1%  
  S&P 500: 3,319 -37.54 -1.1%  
YTD
-3.1%  
 +4.9%  
-9.2%  
 +20.3%  
 +2.7%  
  Targets    Overview: 09/14/2020  
  Up arrow29,400 or 26,700 by 10/01/2020
  Up arrow11,750 or 10,600 by 10/01/2020
  Up arrow845 or 775 by 10/01/2020
  Up arrow11,800 or 10,400 by 10/01/2020
  Up arrow3,600 or 3,200 by 10/01/2020
CPI (updated daily): Arrows on 8/18/20

Bulkowski on Broadening Formations, Right-Angled and Ascending

 

For more information on this pattern, read Encyclopedia of Chart PatternsEncyclopedia of Chart Patterns, pictured on the right, pages 28 to 44.

Updated with new statistics on 8/25/2020.

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

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The right-angled and ascending broadening chart pattern is a mid-list performer in bull markets. Downward breakouts perform slightly worse than upward breakouts, based on the performance rank.

Right-angled and ascending broadeningformation
Right-Angled and Ascending Broadening Formation

 

Important Bull Market Results

Overall performance rank for up/down breakouts (1 is best): 18 out of 39/25 out of 36
Break even failure rate for up/down breakouts: 15%/28%
Average rise/decline: 43%/14%
Throwback/pullback rate: 68%/63%
Percentage meeting price target for up/down breakouts: 67%/40%

The above numbers are based on 551 samples for upward breakouts and 455 for downward breakouts. See the glossary for definitions.

 

Broadening Formations, Right-Angled and Ascending: Identification Guidelines

CharacteristicDiscussion
Price trendCan be up (74% have a rising price trend) leading to the pattern.
ShapeA megaphone tilted up with the bottom horizontal.
TrendlinesThe bottom trendline is horizontal, the top one slopes upward.
TouchesAt least five touches total, three peaks or three valleys should touch the associated trend line with two or more touches of the other trendline. Ideally, the second of three touches will touch (instead of coming 'close' to) the trendline.
VolumeTrends upward 62% to 63% of the time.
BreakoutUpward 55% of the time.

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Broadening Formations, Right-Angled and Ascending: Trading Tips

Trading TacticExplanation Right-angled and ascending broadening formation measure rule
The Measure Rule
Measure ruleCompute the height from the highest peak (point A in the Measure Rule figure to the right) to the horizontal trendline (B) and multiply it by the above 'percentage meeting price target.' Add the result to the highest peak (A, upward breakouts) or subtract it from the horizontal trendline (B, downward breakouts) to get the price target (C).
Intraformation tradeBuy at the horizontal trendline when price starts rising and sell or sell short once price turns at the top trendline.
Buy at 3rd touchWhen price touches the horizontal trendline for the third time and begins rising, buy.
Partial riseA partial rise works 61% of the time.
Partial declineA partial decline works 80% of the time.
Price trendThe best performing patterns are those with a short-term (less than three months) rise leading to the pattern.
Yearly high, lowDownward and upward breakouts perform best when the breakout is within a third of the yearly low.
Volume trendA downward volume trend results in the best postbreakout performance.
Throwbacks and pullbacksThrowbacks and pullbacks hurt postbreakout performance.
Height, widthTall patterns perform better than short ones. Wide patterns (both breakout directions) perform well.

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Broadening Formations, Right-Angled and Ascending: Time Performance

 

Bull Market Performance Over Decades
Breakout Direction1990s2000s2010s
Up (average)41%50%36%
Down (average)16%13%14%

The above table shows the performance of right-angled ascending broadening top chart patterns in bull markets over the last three decades.

Upward breakouts did best in the 2000s but worst in the 2010s.

Downward breakouts outperformed in the 1990s but didn't vary much among the decades.

 

 

Broadening Formations, Right-Angled and Ascending: Example

Right-angled and ascending broadeningformation chart pattern example

The above figure shows an example of a right-angled and ascending broadening formation. A strong advance begins at point D and that leads to the right-angled and ascending broadening formation. Price bounces between two diverging trendlines before it closes outside the bottom trendline at A. This marks the downward breakout. Price recovers and busts the pattern at C when price moves above the top of the chart pattern. A throwback completes at B and price climbs thereafter.

-- Thomas Bulkowski

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Other Broadening Formations, Right-Angled and Ascending: Examples

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:  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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