As of 02/21/2025   Indus: 43,428 -748.63 -1.7%     Trans: 16,034 -430.64 -2.6%     Utils: 1,023 +3.75 +0.4%     Nasdaq: 19,524 -438.35 -2.2%     S&P 500: 6,013 -104.39 -1.7%	YTD  +2.1%    +0.9%    +4.1%    +1.1%    +2.2%	Targets    Overview: 02/13/2025     42,500 or 45,000 by 03/01/2025   16,900 or 15,800 by 03/01/2025   1,050 or 970 by 03/01/2025   19,200 or 20,500 by 03/01/2025   5,875 or 6,200 by 03/01/2025
Chart Pattern Indicator: on 2/19/25

As of 02/21/2025   Indus: 43,428 -748.63 -1.7%     Trans: 16,034 -430.64 -2.6%     Utils: 1,023 +3.75 +0.4%     Nasdaq: 19,524 -438.35 -2.2%     S&P 500: 6,013 -104.39 -1.7%	YTD  +2.1%    +0.9%    +4.1%    +1.1%    +2.2%
Targets    Overview: 02/13/2025     42,500 or 45,000 by 03/01/2025   16,900 or 15,800 by 03/01/2025   1,050 or 970 by 03/01/2025   19,200 or 20,500 by 03/01/2025   5,875 or 6,200 by 03/01/2025
Chart Pattern Indicator: on 2/19/25

Bulkowski on Bullish Key Reversal Bar, v2

Initial release on 2/3/2025.

This article discusses the bullish key reversal bar chart pattern, including what to look for and how it behaves in stocks and exchange traded funds (it is absent in cryptocurrency).

Bullish Key Reversal Bar: Overview

This one-bar price pattern makes twice as much money in stock trades compared to the benchmark, but ties in ETFs and doesn't appear in cryptocurrencies. I question whether the good performance is a fluke, despite using data from 1990 to 2025 in hundreds of stocks. To replicate the performance, see the Identification Guidelines table.

I've more small patterns to test, but this one ranks 4th where 1 is best (in stocks), out of 35 patterns.

Bullish Key Reversal Bar: Identification Guidelines

The following table shows the identification rules.

Look at the figure for an example. The key reversal bar pattern is line AC, a one price bar pattern. The reversal occurs in a short-term downtrend (B). What is short term? Five days is what I used. Often you can eyeball this trend, but I used linear regression (which computes the slope of a line such that the distance from each point to the line is a minimum).

Price should open much lower (C), but close near or above the prior day's close (A). In short, that means it's a tall price bar that swings a down trend to up (C to A).

Bullish Key Reversal Bar: Target Exit, Stock Performance

Trading using a target exit is simple to explain. Look at the adjacent stock chart.

I highlighted the key reversal bar pattern in the box. The reversal is a one-bar pattern that is tall, opens well below the prior close but closes near or above the prior close. It is supposed to act as a reversal of the downtrend.

In this example, price did reverse.

I placed a buy stop a penny above the top of the pattern (horizontal green line), and a stop loss order a penny below the bottom of the pattern. The target exit was twice the height of the reversal bar added to the price of the top of it.

The buy stop triggered for an entry and the stock sold when it climbed to the target exit price.

Testing

As explained in the example above, a buy signal happened when the stock climbed a penny or more above the top of the pattern (that is, I placed a buy stop a penny above the price bar in the pattern). I set an order to sell at a price twice as high as the height of the key reversal added to the high price in the pattern. I placed a stop loss a penny below the bottom of the pattern to help limit losses (by catching a dropping stock automatically).

The tables shows results for bull markets with upward breakouts (only) and a downward inbound price trend. I used 489 stocks in the test. For additional testing methodology details, click the link.

We have a winner! The pattern more than doubles ($135.16 versus $62.36) the benchmark performance from 1990 to 2025 in almost 2,000 trades. It's somewhat rare, meaning I didn't have to limit the data to prevent overflowing my spreadsheet, like I had to do with other patterns.

Bullish Key Reversal Bar: Target Exit, ETF Performance

I used the same method to test the key reversal bar in exchange traded funds (ETFs) as I did in stocks. The chart shows an example trade that failed.

A buy stop triggered two bars after the pattern, and three days after that, the stop loss order triggered for a loss.

Testing

This is the same test as the prior one except I used 94 exchange traded funds (ETFs) instead of common stocks.

The key reversal appears substantially less often in ETFs than in stocks. Those that do appear don't perform well, either. I don't recommend trading this in ETFs and wonder if the glorious performance in stocks can live up to the theoretical results. Why? Because it does so well in stocks but flops in ETFs. That's unusual and it suggests the potential of under-performance (in stocks).

Bullish Key Reversal Bar: Target Exit, Crypto Performance

I found only one trade in the dozens of cryptocurrency files I looked at. That's too few to remark on.

-- Thomas Bulkowski

See Also

• Key reversal, uptrend
• Key reversal, downtrend
• How did I test small patterns in stocks, ETFs, and crypto currency?
• Small pattern performance.
• Updated daily list of short patterns.

Other1-bar patterns

• Closing price reversal, uptrend
• Closing price reversal, downtrend
• Bearish key reversal bar, v2
• One-day reversal top
• One-day reversal bottom
• Wide ranging day downside reversal
• Wide ranging day upward reversal