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 Wide Ranging Day Upside Reversal

Updated with new performance, corrected, information on 11/25/24.

Important Results Identification Guidelines Trading Tips Performance Statistics Performance and Failure Rates Measure Rule Trading Performance Trading Example Target Exit, Stock Performance   Target Exit, ETF Performance   Target Exit, Crypto Performance   See Also

Wide Ranging Day Upside Reversal

Wide Ranging Day Upside Reversal: Important Bull Market Results

Wide Ranging Day Upside Reversal: Identification Guidelines

Wide Ranging Day Upside Reversal: Trading Tips

Wide Ranging Day Upside Reversal: Performance Statistics

For the following statistics, I used 1,138 stocks, starting from January 1990 to March 2013, but few stocks covered the entire range. All stocks had a minimum price of $5. There were two bear markets in the 2000s (as determined by the S&P 500 index), from 3/24/2000 to 10/10/2002 and 10/12/2007 to 3/6/2009. Everything outside of those dates represents a bull market.

For each wide ranging day upside reversal, I found when the trend started and when it ended. To find the trend peak or valley, I found the lowest valley and highest peak within plus or minus 5 days (11 days total) each, before the wide ranging day upside reversal and the same peak/valley test after the wide ranging day upside reversal. The closest valley or peak before the wide ranging day upside reversal is where the trend began. The closest peak or valley after the wide ranging day upside reversal is where the trend ended. I compared the peak or valley to the average of the high and low price of the wide ranging day upside reversal.

The 5-bar peak or valley number tends to find major turning points on the daily charts.

I measured performance from the day after the breakout (opening price) to the nearest trend peak or trend valley.

To determine the inbound price trend (I was looking for a down trend), I used linear regression on the average of the high-low prices in the five days before pattern. That caught the short-term trend.

Wide Ranging Day Upside Reversal: Performance and Failure Rates

Table 1 lists the failure rates, sorted by market condition and breakout direction along with the average rise or drop.

A failure occurs when the stock fails to move in the direction of the breakout more than 5%.

The failure rates may appear high, but that's typical for short-term patterns like the wide ranging day upside reversal. The highest failures occur in a bull market. The 16% average drop for the bear market and downward breakout can probably be explained by few samples: 150.

Wide Ranging Day Upside Reversal: Measure Rule

Table 2 shows how often the measure rule works. Use the measure rule to estimate of how far price is likely to rise or drop.

To do this, measure from the high to the low in pattern to get the height. Add the height to the high or subtract it from the low to get the target. Price does best in a bear market after a downward breakout. It reaches the target 47% of the time, on average. The low percentages are due to the tall nature of the pattern.

Wide Ranging Day Upside Reversal: Trading Performance

Table 3 shows the performance based on 4,291 trades using $10 commissions per trade ($20 round trip), starting with $10,000 per trade. No other adjustments were made for interest, fees, slippage and so on.

Here's the setup.

• Find a wide ranging day upside reversal uptrend.
• Wait for price to close above the top or below the bottom of the pattern.
• Buy/short at the open the next day.
• Take profit when price moves 7%.
• A stop placed 7% away closes out the trade for a loss.

For example, in a bull market, the net gain was $75.98 for all trades. The method won 56% of the time and there were 1,630 winning trades. The average gain of winning trades was $717.71.

Forty-four percent, or 1,273 trades were losers. They lost an average of $745.71.

The average hold time was 27 calendar days.

Notice how the gains and losses were pegged near 7%, which is how the test was setup.

Wide Ranging Day Upside Reversal: Trading Example

The figure shows the wide ranging day upside reversal at A.

Price drops in the days leading to the wide ranging day. In this example, price opens near the bottom and closes near the intraday high, making a very tall price bar.

The next day, the stock breaks out upward by closing above the top of the wide ranging day. I show that at B.

Buy the stock at the open at C.

Not shown is a 7% profit target or 7% stop loss, both based on the entry price.

Wide Ranging Day Upside Reversal: Target Exit, Stock Performance

The following tests are different from the ones above.

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

I highlight the WRDUR pattern in the chart (red). Entry happens when the stock climbs above a buy stop placed a penny above the top of the pattern. The target is twice the height of the WRDUR added to the top of the pattern.

A stop loss order placed a penny below the bottom of the pattern helps prevent a bigger loss.

In this example, the stop is triggered and the stock sold for a loss.

For a more detailed explanation of the method I used to test the WRDUR, see the link.

Testing

As explained in the example above, I used a target exit placed twice as high as the height of the WRDUR pattern added to the top of it. I placed a stop loss a penny below the bottom of the pattern.

Table 5 shows results for bull markets with upward breakouts and an inbound downward price trend leading to the WRDUR (because a downtrend is built into the WRDUR identification guidelines). I used 492 stocks in the test.

To find enough samples, I reduced the minimum height of the WRDUR from three times the average 1-month height to twice.

For stocks, the WRDUR pattern more than doubles the benchmark performance ($134.10 versus $62.36).

Wide Ranging Day Upside Reversal: Target Exit, ETF Performance

The associated chart shows an example of how I tested the WRDUR pattern in exchange traded funds (ETFs).

The red line points to the WRDUR. The day after the pattern ends, we have an upward breakout accompanied by a tall gap. Entry occurs on the day price gapped higher, at the open.

The target exit is twice the height of the pattern added to the top of it. The exit order triggers, locking in a tidy profit.

Testing

This is the same test as the prior one except I used 94 exchange traded funds (ETFs) instead of common stocks. Again, the height of the WRDUR is twice the one-month average instead of three times.

Table 6. The WRDUR pattern in ETFs almost doubles the benchmark performance, by $83.38 to $49.24, respectively.

Wide Ranging Day Upside Reversal: Target Exit, Crypto Performance

This is an example trade in the cryptocurrency AAVE on the daily scale. I point to the WRDUR pattern using the red line.

Entry is a penny above the top of the chart pattern with a buy-stop

A stop-loss order helps minimize the loss with a sell price of a penny below the bottom of the pattern. The two green lines show the approximate buy stop and stop-loss order locations.

The currency broke out upward and continued rising. The day before the crypto sold, the trade was nearly stopped out. However, the next day, the target exit closed out the trade for a win.

Testing

This is the same test as the prior one except I used 38 cryptocurrencies instead of common stocks. The height was twice the one-month average for selection, instead of three times.

The WRDUR works well in cryptocurrencies by outperforming the benchmark, but sample counts are comparatively small. I'd be suspicious about the large gain.

-- Thomas Bulkowski

See Also

• 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
• Bullish key reversal bar, v2
• Bearish key reversal bar, v2
• One-day reversal top
• One-day reversal bottom (downtrend)
• Wide ranging day downside reversal

The most common name in the world is Mohammed.