suriNotes.com’s Nov. 06, 2017 Chart Patterns & Algo. Trader Trading Rectangle Channels ●Daily/Weekly/Monthly Analysis ●Auto Generated Chart Patterns/Analysis ●Algorithmic Trading Analysis/Results ●Relative Strength Ranks A Weekly Magazine Biotech Stocks
Chart Patterns & Algorithmic Trader 2017 ALL RIGHTS RESERVED No part of this document may be reproduced or transmitted without the express written consent of the suriNotes.com or Suri Duddella. This document relies on sources and information reasonably believed to be accurate, but neither the author nor publisher guarantees accuracy or completeness. The examples in this document could be considered hypothetical trades. The CFTC warns that: HYPOTHETICAL PERFORMANCE RESULTS HAVE MANY INHERENT LIMITATIONS, SOME OF WHICH ARE DESCRIBED BELOW. NO REPRESENTATION IS BEING MADE THAT ANY ACCOUNT WILL OR IS LIKELY TO ACHIEVE PROFITS OR LOSSES SIMILAR TO THOSE SHOWN. IN FACT, THERE ARE FREQUENTLY SHARP DIFFERENCES BETWEEN HYPOTHETICAL PERFORMANCE RESULTS AND THE ACTUAL RESULTS SUBSEQUENTLY ACHIEVED BY ANY PARTICULAR TRADING PROGRAM. ONE OF THE LIMITATIONS OF HYPOTHETICAL PERFORMANCE RESULTS IS THAT THEY ARE GENERALLY PREPARED WITH THE BENEFIT OF HINDSIGHT. IN ADDITION, HYPOTHETICAL TRADING DOES NOT INVOLVE FINANCIAL RISK, AND NO HYPOTHETICAL TRADING RECORD CAN COMPLETELY ACCOUNT FOR THE IMPACT OF FINANCIAL RISK IN ACTUAL TRADING. FOR EXAMPLE, THE ABILITY TO WITHSTAND LOSSES OR TO ADHERE TO A PARTICULAR TRADING PROGRAM IN SPITE OF TRADING LOSSES ARE MATERIAL POINTS WHICH CAN ALSO ADVERSELY AFFECT ACTUAL TRADING RESULTS. THERE ARE NUMEROUS OTHER FACTORS RELATED TO THE MARKETS IN GENERAL OR TO THE IMPLEMENTATION OF ANY SPECIFIC TRADING PROGRAM WHICH CANNOT BE FULLY ACCOUNTED FOR IN THE PREPARATION OF HYPOTHETICAL PERFORMANCE RESULTS AND ALL OF WHICH CAN ADVERSELY AFFECT ACTUAL TRADING RESULTS. COPYRIGHT © 2017 – suriNotes.com Data & Charts are created by TradeStation Software from TradeStation Securities. Published in the United States of America
Disclaimer: All the material in this document is provided as Educational Material only. NONE of the chart patterns or chart setups or all other material in this document are trade recommendations. Trading is risky. You are 100% responsible for your own trading. Trading is risky. You are 100% responsible for your own trading. suriNotes.com or Suri Duddella, specifically disclaims any and all express and implied warranties. Your trades may entail substantial loss. Nothing in this document should be construed as a recommendation to buy or sell any security or other instrument, or a determination that any trade is suitable for you. Chart Patterns and other material in this document are Auto generated in TradeStation software and we try our best to check for errors and data consistency, but they may still consist of data or algorithmic errors.
Market Quotes “Bull markets are born on pessimism, grown on skepticism, mature on optimism, and die on euphoria.” - John Templeton “A bull market tends to bail you out of all your mistakes. Conversely, bear markets make you pay for your mistakes.” - Richard Russell "Being simply better than average is not good enough. You have to be head and shoulders above the crowd to win a minus-sum game.” - Alexander Elder
Table of Contents US Markets Patterns Gallery Chart Patterns Biotech Stocks Stocks/Futures/Commodities/FX Earnings Next Week/Charts Hot Watch Lists Bullish/Bearish, Relative Strength Key Supp/Resistance/Pivots Charts Gap Charts Weekly Relative Performances ALGORITHMIC TRADER Trading Rectangle Chart Patterns Algorithmic Trades Symbols Universe Books/Websites/Software
Chart Links ■IBB Parabolic Arc Pattern ■ALNY Parabolic Arc Pattern ■BIIB Parabolic Arc Pattern ■BMY Inv. H&S Pattern ■CELG AB=CD Pattern ■GILD Head and Shoulders Pattern ■GILD Parabolic Arc Pattern ■MRK Rectangle Channel ■UTHR Parabolic Arc Pattern ■AMGN Cup & Handle Pattern ■JAZZ Cup & Handle Pattern ■AGN Parabolic Arc Pattern ■INTC Chart Patterns ■EA Parabolic Arc Pattern ■TSLA 2B Top Pattern ■CSCO Cup & Handle Pattern ■SWKS Cup & Handle Pattern ■FB ABC Bullish Pattern ■INTC ABC Bullish Pattern ■HDB ABC Bullish Pattern ■PZZA H&S Pattern ■AMAT Ascending Triangle Pattern ■JD ABC Bearish Pattern ■WMT ABC Bullish Pattern ■LMT Parabolic Arc Pattern ■SPLK Cup & Handle Pattern ■NKE Rectangle Channel Pattern ■USO Inv. HS Pattern ■XLV Cup & Handle Pattern ■@CL Inv. HS Pattern ■@FC Inv. HS Pattern ■@GC ABC Bullish Pattern 13 14 15 16 17 18 19 20 21 22 23 24 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 44 45 46
■@TY Bullish Cypher Pattern ■@HO Inv. HS Pattern ■@JY Rectangle Channel ■@KC Falling Wedge Pattern ■@LH Inv. HS Pattern ■@OJ ABC Bullish Pattern ■@SB Descending Triangle ■@SI ABC Bullish Pattern ■AUDJPY Inv. HS Pattern ■AUDNZD Double Bottom Pattern ■AUDUSD ABC Bullish Pattern ■CADCHF Bull Flag Pattern ■USDCAD Parabolic Arc Pattern ■EURCAD ABC Bullish Pattern ■SGDJPY ABC Bullish Pattern ■ULTI Inv. H&S Pattern ■CRZO AB=CD Pattern ■JAZZ Cup & Handle Pattern ■ZBRA Cup & Handle Pattern ■AZN Inv. HS Pattern ■DIS AB=CD Pattern ■NVDA Parabolic Arc Pattern ■HDB ABC Bullish Pattern ■SLV Inv. H&S Pattern ■REGN ABC Bearish Pattern 47 48 49 50 51 52 53 54 56 57 58 59 60 61 62 63 78 79 80 81 82 83 84 85 86
Major Markets Patterns Gallery
Major Indexes %Chg YTD
Biotech Stocks
Biotech Stocks
Biotech Stocks
Chart Patterns & Algorithmic Trader (13) IBB Parabolic Arc Pattern IBB (Weekly) Nasdaq Biotech ETF is trading in Parabolic Arc pattern. Most Biotech stocks are in the same pattern formation. www.surinotes.com
Chart Patterns & Algorithmic Trader (14) ALNY Parabolic Arc Pattern ALNY (W) has completed Parabolic Arc pattern. Most Parabolic Arc patterns return to at least 50-62% of prior retracement. ALNY’s Parabolic Arc entered into a Short setup below $110 with potential targets at $73, $35 to $57. ALNY completed 79% retracement and completed Parabolic Arc pattern. After reaching its targets, most stocks in ParArc patterns do bounce and trade higher. www.surinotes.com
Chart Patterns & Algorithmic Trader (15) BIIB Parabolic Arc Pattern BIIB (W) trading in Parabolic Arc patterns like many biotech stocks. BIIB has a minor bullish trend (in eSix with divergence) and also may be trading in ABC Bullish pattern. www.surinotes.com
Chart Patterns & Algorithmic Trader (16) BMY Inv. H&S Pattern BMY (Daily) is trading in Inv. HS Pattern. BMY has reached Inv. HS 2nd target range (63.5 to 65.3) from Neckline $56.83. BMY (Weekly) is also in Parabolic Arc pattern. www.surinotes.com
Chart Patterns & Algorithmic Trader (17) CELG AB=CD Pattern CELG (Daily) completed AB=CD bearish pattern. CELG AB=CD Bearish pattern was confirmed below $140 with a Stop above ‘D’ $147. First Target range is $107-116 and 100% target is at 96.93. www.surinotes.com
Chart Patterns & Algorithmic Trader (18) GILD Head and Shoulders Pattern GILD (W) is trading in Head and Shoulders pattern. Neckline: 85.95, Targets $5662.82. GILD is also in Parabolic Arc pattern. www.surinotes.com
Chart Patterns & Algorithmic Trader (19) GILD Parabolic Arc Pattern GILD is trading in Parabolic arc pattern. www.surinotes.com
Chart Patterns & Algorithmic Trader (20) MRK Rectangle Channel MRK (Daily) is trading in Rectangle Channel pattern. MRK channel breakdown level is below $61.87 with a stop at $64.33. Target range: $59.41 to $56.94. Second target range is $56.94 to $52. www.surinotes.com
Chart Patterns & Algorithmic Trader (21) UTHR Parabolic Arc Pattern UTHR (W) is trading in Parabolic Arc pattern. UTHR’s downside targets: $113, $95. www.surinotes.com
Chart Patterns & Algorithmic Trader (22) AMGN Cup & Handle Pattern AMGN (Daily) is trading in Cup & Handle pattern. AMGN traded above breakout level (184.21) in September 2017. Currently price retraced back into handle area. C&H patterns are valid only when price trades above breakout levels. If price continues to drop below middle of Cup level ($168), C&H pattern may be a failed pattern. www.surinotes.com
Chart Patterns & Algorithmic Trader (23) JAZZ Cup & Handle Pattern JAZZ (Daily) is trading in Cup & Handle pattern. JAZZ breakout level is $160. www.surinotes.com
Chart Patterns & Algorithmic Trader (24) AGN Parabolic Arc Pattern AGN is trading in Parabolic Arc pattern. Target ranges: $180, $89-$141. www.surinotes.com
Chart Patterns Stocks/Options/Indexes
Chart Patterns & Algorithmic Trader (26) INTC Chart Patterns The above graphic shows INTC (Intel Corp.) Multiple chart patterns in multiple timeframes. A. Rectangle Channel (Daily), B. ABC Bullish Pattern (Weekly), C Inv. H&S Pattern (Monthly) and D. A completed ABC Bullish Pattern in Daily charts. www.surinotes.com
Chart Patterns & Algorithmic Trader (27) EA Parabolic Arc Pattern EA (Weekly) is trading in Parabolic Arc pattern. Currently trend is still strong and does not have trade entry for Parabolic Arc pattern. www.surinotes.com
Chart Patterns & Algorithmic Trader (28) TSLA 2B Top Pattern TSLA (D) completed 2B Top pattern call (CPAT2, Sept. 25, 2017). 2B Top target was at $304. If TSLA continues its downtrend, next target range: $240-250. www.surinotes.com
Chart Patterns & Algorithmic Trader (29) CSCO Cup & Handle Pattern CSCO (Earnings: 11/15) is trading in Cup & Handle pattern. Breakout level: $34.60. C&H patterns are only valid if price closes above breakout level. www.surinotes.com
Chart Patterns & Algorithmic Trader (30) SWKS Cup & Handle Pattern SWKS (W) is trading in Cup & Handle Pattern. Breakout level: $112.88. C&H patterns are only valid if price closes above breakout level. www.surinotes.com
Chart Patterns & Algorithmic Trader (31) FB ABC Bullish Pattern FB (Daily) has reached ABC Bullish Pattern targets (129-133, 146-155, 171-180) from the long entry level: 117.70. www.surinotes.com
Chart Patterns & Algorithmic Trader (32) INTC ABC Bullish Pattern $INTC (W) ABC Bullish Pattern Long Entry above 27.44, Stop below 24.86 (-2.58), Target1 Zone: 36.4 to 39.5, Target2 Zone: 48.6 to 55.1 www.surinotes.com
Chart Patterns & Algorithmic Trader (33) HDB ABC Bullish Pattern HDB (W) is trading in ABC Bullish Pattern. Targets: $88-96, $111-119. www.surinotes.com
Chart Patterns & Algorithmic Trader PZZA H&S Pattern (34) $PZZA (W) HS Pattern. Short entry below 73.77, Stop above 79.48 (-5.72), Target1 Zone: 63.4 to 60.6, 57.05, Target2 Zone: 52.5 to 46.7 www.surinotes.com
Chart Patterns & Algorithmic Trader (35) AMAT Ascending Triangle Pattern AMAT (Daily) is trading in Ascending Triangle (See post in CPAT magazine Sept. 18). AMAT breakout level is above $47.86. Upside targets: $51-54. www.surinotes.com
Chart Patterns & Algorithmic Trader (36) JD ABC Bearish Pattern JD (Daily) is trading in ABC Bearish pattern. JD is also trading in H&S pattern. JD’s short entry is below $43 (confirmed by eSix trend) with targets $38.3 to $40, $36, $30-33.5. www.surinotes.com
Chart Patterns & Algorithmic Trader (37) WMT ABC Bullish Pattern $WMT (W) ABC Bullish Pattern Long Entry above 68.50, Stop below 65.27 (-3.23), Target1 Zone: 77.0 to 80.1, Target2 Zone: 89.3 to 95.9 www.surinotes.com
Chart Patterns & Algorithmic Trader (38) LMT Parabolic Arc Pattern LMT (Weekly) is trading in Parabolic Arc pattern. No trade trigger. www.surinotes.com
Chart Patterns & Algorithmic Trader (39) SPLK Cup & Handle Pattern SPLK (D) is trading in Cup & Handle pattern. Breakout is above $69. Targets: $75, $78-81. www.surinotes.com
Chart Patterns & Algorithmic Trader (40) NKE Rectangle Channel Pattern NKE (Daily) is trading in Rectangle Channel pattern. NKE’s rectangle range is 50.79 to $60.53. www.surinotes.com
Chart Patterns & Algorithmic Trader (41) USO Inv. HS Pattern $USO (D) Inv. HS Pattern. Long entry above 10.32, Stop below 9.83 (0.49), Target1 Zone: 11.4 to 11.6, Target2 Zone: 12.4 to 13.0 www.surinotes.com
Chart Patterns & Algorithmic Trader (42) XLV Cup & Handle Pattern XLV (Daily, Health Care ETF) is trading in Cup & Handle pattern since its breakout above $76. First Target range is $82-83.89. Next Targets: $86, 88.75 to $92. www.surinotes.com
Chart Patterns Futures & Commodities
Chart Patterns & Algorithmic Trader (44) @CL Inv. HS Pattern $@CL (D) Inv. HS Pattern. Long entry above 51.36, Stop below 48.86 (2.50), Target1 Zone: 56.4 to 57.8, Target2 Zone: 61.7 to 64.6 www.surinotes.com
Chart Patterns & Algorithmic Trader (45) @FC Inv. HS Pattern @FC (D) Inv. HS Pattern. Long entry above 156.750, Stop below 152.838 (3.912), Target1 Zone: 167.77 to 170.76, Target2 Zone: 179.39 to 185.63 www.surinotes.com
Chart Patterns & Algorithmic Trader (46) @GC ABC Bullish Pattern @GC (Gold Futures) is trading in ABC Bullish pattern above 200-SMA. @GC’s recent trend (eSix) is RED and needs a clear confirmation for a trade trigger. $@GC ) ABC Bullish Pattern Long Entry above 1281.7, Stop below 1262.7 (-19.0), Target1 Zone: 1357 to 1382, 1415, www.surinotes.com
Chart Patterns & Algorithmic Trader (47) @TY Bullish Cypher Pattern @TY (Daily) is trading in Bullish Cypher Pattern. The eSix trend is still negative. Entry, Targets and Stops are plotted on the chart. www.surinotes.com
Chart Patterns & Algorithmic Trader (48) @HO Inv. HS Pattern $@HO (D) Inv. HS Pattern. Long entry above 1.6281, Stop below 1.5823 (0.0458), Target1 Zone: 1.799 to 1.846, 1.9047. Target2 Zone: 1.979 to 2.076 www.surinotes.com
Chart Patterns & Algorithmic Trader (49) @JY Rectangle Channel @JY (Daily) is forming Rectangle channel. Watch upper and lower trend lines for potential trades. Potential target levels are shown in green shaded areas. www.surinotes.com
Chart Patterns & Algorithmic Trader (50) @KC Falling Wedge Pattern @KC (Coffee Futures, Weekly) is trading in Falling Wedge pattern. Falling Wedge patterns are bullish only when price trades above the upper trendline. ESix is currently red and in negative zone. www.surinotes.com
Chart Patterns & Algorithmic Trader (51) @LH Inv. HS Pattern @LH (W) Inv. HS Pattern. Long entry above 69.100, Stop below 62.425 (6.675), Target1 Zone: 84.41 to 88.57, Target2 Zone: 100.56 to 109.24 www.surinotes.com
Chart Patterns & Algorithmic Trader (52) @OJ ABC Bullish Pattern $@OJ (W) ABC Bullish Pattern Long Entry above 132.50, Stop below 117.05 (15.45), Target1 Zone: 192.5 to 213.0, Target2 Zone: 272.0 to 314.7 www.surinotes.com
Chart Patterns & Algorithmic Trader (53) @SB Descending Triangle @SB (Daily) is trading in Descending Triangle. After initial breakout, price retraced below the upper trend line. If it traded again above the trendline, it may confirm the breakout. www.surinotes.com
Chart Patterns & Algorithmic Trader (54) @SI ABC Bullish Pattern $@SI (D) ABC Bullish Pattern Long Entry above 16.786, Stop below 16.340 (-0.446), Target1 Zone: 18.23 to 18.75, Target2 Zone: 20.23 to 21.30 www.surinotes.com
Chart Patterns FX
Chart Patterns & Algorithmic Trader (56) AUDJPY Inv. HS Pattern AUDJPY (W) Inv. HS Pattern. Long entry above 88.171, Stop below 84.827 (3.344), Target1 Zone: 97.98 to 100.64, Target2 Zone: 108.32 to 113.87 www.surinotes.com
Chart Patterns & Algorithmic Trader (57) AUDNZD Double Bottom Pattern $AUDNZD (D) ABC Bullish Pattern Long Entry above 1.04236, Stop below 1.03630 (-0.00606), Target1 Zone: 1.0795 to 1.0912, Target2 Zone: 1.1250 to 1.1495. www.surinotes.com
Chart Patterns & Algorithmic Trader (58) AUDUSD ABC Bullish Pattern $AUDNZD (D) ABC Bullish Pattern Long Entry above 1.04236, Stop below 1.03630 (-0.00606), Target1 Zone: 1.0795 to 1.0912, Target2 Zone: 1.1250 to 1.1495 www.surinotes.com
Chart Patterns & Algorithmic Trader (59) CADCHF Bull Flag Pattern CADCHF is trading Bull Flag pattern. www.surinotes.com
Chart Patterns & Algorithmic Trader (60) USDCAD Parabolic Arc Pattern USDCAD (W) is trading in Parabolic Arc pattern. www.surinotes.com
Chart Patterns & Algorithmic Trader (61) EURCAD ABC Bullish Pattern $EURCAD (W) ABC Bullish Pattern Long Entry above 1.40986, Stop below 1.37830 (-0.03156), Target1 Zone: 1.5687 to 1.6205, Target2 Zone: 1.7697 to 1.8775 www.surinotes.com
Chart Patterns & Algorithmic Trader (62) SGDJPY ABC Bullish Pattern $SGDJPY (D) ABC Bullish Pattern Long Entry above 80.525, Stop below 79.688 (0.837), Target1 Zone: 82.88 to 83.75, Target2 Zone: 86.25 to 88.05 www.surinotes.com
Chart Patterns & Algorithmic Trader (63) ULTI Inv. H&S Pattern $ULTI (D) Inv. HS Pattern. Long entry above 199.39, Stop below 194.70 (4.69), Target1 Zone: 210.4 to 213.4, Target2 Zone: 222.0 to 228.2, T3: $239-246. www.surinotes.com
Key Support/Resistance, Pivots
Chart Patterns & Algorithmic Trader (65) ES Fib. Zone Pivots @ES Fib. Zone Pivots www.surinotes.com
Chart Patterns & Algorithmic Trader (66) NQ Fib. Zone Pivots NQ Fib. Zone Pivots www.surinotes.com
Chart Patterns & Algorithmic Trader (67) QM Fib. Zone Pivots QM Fib. Zone Pivots www.surinotes.com
Chart Patterns & Algorithmic Trader (68) @GC Fib. Zone Pivots @GC Fib. Zone Pivots www.surinotes.com
Chart Patterns & Algorithmic Trader (69) YM Fib. Zone Pivots YM Fib. Zone Pivots www.surinotes.com
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GAP Charts Shows filled and unfilled gap levels
Chart Patterns & Algorithmic Trader @ES Gap Chart (72) @ES Gap chart with filled and unfilled Gaps with at least 1 ATR Gap. www.surinotes.com
Chart Patterns & Algorithmic Trader @NQ Gap Chart (73) @NQ Gap chart with filled and unfilled Gaps with at least 1 ATR Gap. www.surinotes.com
Chart Patterns & Algorithmic Trader @YM Gap Chart (74) @YM Gap chart with filled and unfilled Gaps with at least 1 ATR Gap. www.surinotes.com
Earnings Companies releasing earnings in the next few weeks.
November Earnings Calendar
December Earnings Calendar
Chart Patterns & Algorithmic Trader (78) CRZO AB=CD Pattern CRZO (W), Earnings: 11/7/17 is trading in AB=CD Pattern. CD retracement is 81%AB range. www.surinotes.com
Chart Patterns & Algorithmic Trader (79) JAZZ Cup & Handle Pattern JAZZ (Daily, Earnings: 11/7/17) is trading in Cup & Handle pattern. Breakout level is $160. www.surinotes.com
Chart Patterns & Algorithmic Trader (80) ZBRA Cup & Handle Pattern ZBRA (Earnings 11/7/17) is trading in Cup & Handle pattern. Breakout level is $119.47. www.surinotes.com
Chart Patterns & Algorithmic Trader (81) AZN Inv. HS Pattern $AZN (W) Inv. HS Pattern. Long entry above 35.04, Stop below 31.73 (3.30), Target1 Zone: 40.9 to 42.5, Target2 Zone: 47.1 to 50.4 www.surinotes.com
Chart Patterns & Algorithmic Trader (82) DIS AB=CD Pattern DIS (Earnings: 11/9) completed AB=CD Pattern. www.surinotes.com
Chart Patterns & Algorithmic Trader (83) NVDA Parabolic Arc Pattern NVDA (W, Earnings: 11/9) is trading in Parabolic Arc pattern. NVDA’s parabolic arc may not have a trade trigger, but most parabolic arc patterns retrace about 50-62% of its prior rise. www.surinotes.com
Chart Patterns & Algorithmic Trader (84) HDB ABC Bullish Pattern $HDB (W) ABC Bullish Pattern Long Entry above 61.41, Stop below 58.99 (-2.42), Target1 Zone: 73.2 to 77.0, Target2 Zone: 88.1 to 96.1 www.surinotes.com
Chart Patterns & Algorithmic Trader (85) SLV Inv. H&S Pattern $SLV (D) Inv. HS Pattern (F). Long entry above 16.80, Stop below 16.11 (0.69), Target1 Zone: 18.3 to 18.7, Target2 Zone: 19.8 to 20.6 www.surinotes.com
Chart Patterns & Algorithmic Trader (86) REGN ABC Bearish Pattern REGN is trading in ABC Bearish pattern. Entry is below $451. First target range: $414-428, next targets: $398, $348-376. www.surinotes.com
Weekly Relative Performances
Sector & Indexes Relative Performances Winners: Oil,SemiConductors, BioTech Losers: Airlines, Telecom, HealthCare
Dow 30 Weekly Relative Performance
Select Sectors Weekly Performance
Country ETFs Weekly Performance
Commodity ETFs Weekly Performance
Futures Weekly Performance
FX Weekly Performance
Watch Lists Momentum Relative Strength Bullish/Bearish Lists NH/NL Oversold/Overbought Key Retracements
Relative Strength Ranks (200)
RS Ranks Sorted (Alpha)
Bullish/Bearish List
52 Week Highs and Lows
D%, W%, M%, YTD%
Algorithmic Trading Algo. Techniques Algo. Reports Current Algorithms ALL RETURNS POSTED ON THIS PUBLICATION ARE HYPOTHETICAL PERFORMANCE GENERATED BY COMPUTERIZED SYSTEM AND THEY ARE NOT ACTUAL TRADE REPORTS. HYPOTHETICAL PERFORMANCE RESULTS HAVE MANY INHERENT LIMITATIONS, SOME OF WHICH ARE DESCRIBED BELOW. NO REPRESENTATION IS BEING MADE THAT ANY ACCOUNT WILL OR IS LIKELY TO ACHIEVE PROFITS OR LOSSES SIMILAR TO THOSE SHOWN. IN FACT, THERE ARE FREQUENTLY SHARP DIFFERENCES BETWEEN HYPOTHETICAL PERFORMANCE RESULTS AND THE ACTUAL RESULTS SUBSEQUENTLY ACHIEVED BY ANY PARTICULAR TRADING PROGRAM. ONE OF THE LIMITATIONS OF HYPOTHETICAL PERFORMANCE RESULTS IS THAT THEY ARE GENERALLY PREPARED WITH THE BENEFIT OF HINDSIGHT. IN ADDITION, HYPOTHETICAL TRADING DOES NOT INVOLVE FINANCIAL RISK, AND NO HYPOTHETICAL TRADING RECORD CAN COMPLETELY ACCOUNT FOR THE IMPACT OF FINANCIAL RISK IN ACTUAL TRADING. FOR EXAMPLE, THE ABILITY TO WITHSTAND LOSSES OR ADHERE TO A PARTICULAR TRADING PROGRAM IN SPITE OF TRADING LOSSES ARE MATERIAL POINTS WHICH CAN ALSO ADVERSELY AFFECT ACTUAL TRADING RESULTS. THERE ARE NUMEROUS OTHER FACTORS RELATED TO THE MARKETS IN GENERAL OR TO THE IMPLEMENTATION OF ANY SPECIFIC TRADING PROGRAM WHICH CANNOT BE FULLY ACCOUNTED FOR IN THE PREPARATION OF HYPOTHETICAL PERFORMANCE RESULTS AND ALL OF WHICH CAN ADVERSELY AFFECT ACTUAL TRADING RESULTS.
Trading Rectangle Channel Patterns by Suri Duddella Markets provide two types of trading activity: Trending markets or Consolidating markets. Trending periods are obvious as price tends to move in one direction (up or down) without many interruptions whereas consolidation periods are indecisive and cautious as price neither continuing or reversing in a larger price trend. These consolidation periods can last from few days to several months and typically trade within a limited range and offer few trading opportunities. This price balance between bulls and bears leads to the bounded range in which price levels of resistance and support are formed in parallel to each other. This bounded range results in a Rectangular Channel pattern (or A Box Pattern). Rectangle channel patterns consist of two parallel trendlines bounding the price-action having multiple pivot points forming at equal highs and equal lows. As price approaches the lower trendline, bullish sentiment (or bulls) sets to push the price up towards the upper trendline, and when the price reaches the upper trendline, bearish sentiment (or bears) tend to push the price down towards the lower trendline, thus creating a tug-ofwar. Each of these thrusts must form at least two key pivot points on the upper and lower trendlines to create a rectangle channel. This bounded range becomes a consolidation area, where traders are indecisive and may not take trend based trades. Rectangle Channel patterns is one of the popular charting technique and they are reliable chart patterns and do provide precise entry, exit, stop and target trading levels. In general, this type of pattern falls into a broader "Channeling" pattern category along with Ascending channels (rising channels) or Descending (falling channels). In Ascending channels (Rising), the price makes consecutive higher highs and higher lows, whereas, in Descending Channels (Falling), the price makes consecutive lower highs and lower lows. In Rectangle channels, the price makes horizontal (parallel) highs and lows in a box formation. These channel patterns can be both continuous or reversal patterns. The price action inside the pattern itself is considered neutral. Trading Rectangle Channels Rectangle Channel patterns are formed by price action between two key trendlines bound by multiple equal (near) highs and lows. The duration of the pattern can be few days to months. Longer duration patterns are considered to be more reliable. The pattern must have at least two pivots (equal highs or equal lows) on each of the trendlines. The price breakout can occur in any direction from the pattern, but the general belief is price may breakout in the same direction as prior direction before the pattern formation. The volume inside the pattern is non-decisive, but volume tends to increase during the breakouts. Trade: A trade setup occurs when price closes outside the trend line (upper or lower) at least two bars signaling a breakout. Trades are entered on a follow-up bar at high above the breakout bar or low below the breakdown bar. Target: Targets in Rectangle Channel formations are based on the depth of the rectangle pattern. Targets are usually set at 70 to 100% of the depth of rectangle from the trade entry. Stop: Rectangle patterns fail when prices retrace into the middle of the rectangle channel. Place a stop order just below the middle of the channel. Rectangle Channel with upside breakout
Rectangle channel with downside Trading Example MSFT has been trading in a rectangle channel from October 2014 between 39.76 to 49.35. Late October 2015, MSFT broke above $49.35 and started a new Rectangle channel from 49.35 to $56.85. Again in October 2016, MSFT broke above $56.85. When Rectangle channels breakout the targets are measured using the height of the channel. Here the MSFT channel height was $7.50. So, targets are built using this height above the breakout. If price continues to trade higher, multiples of these channel height are used. The chart shows how multiples of those target levels are computed. In October 2017, MSFT reached 400% of channel height ($7.50) from its breakout level ($56.85) to $86.85.
Current Examples Current Examples
PlatoAlgo. Performance Report (11/03/17) Short/Medium Term, Not for Sale or Lease.
Monty Algo. Performance (11/03/2017) Long Term, NOT for Lease or Sale
Symbols Universe
Symbol Universe of Stocks/ETFs
Symbols Universe
Books/Websites/Software
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