Getting Started in Chart Patterns, 2nd Edition

Glossary

average The sum of the scores divided by the number of scores.

average rise or decline (ARD) I measure the rise from the breakout price to the ultimate high, or the decline from the breakout price to the ultimate low, for each stock, and then compute the average.

bear market I used the peaks in the Standard & Poor's 500 Index on March 24, 2000, and October 12, 2007, and the lows on October 10, 2002, and March 6, 2009, as the start and end of a bear market.

breakout Table G.1 shows the breakout location for each pattern.

TABLE G.1 Breakout Location for Chart Patterns

Chart Pattern	Breakout Location
Broadening patterns, all types	A close outside the trendline boundary
Diamond Tops and Bottoms	A close outside the trendline boundary
Double Bottoms, all types	A close above the highest peak between the two valleys
Double Tops, all types	A close below the lowest valley between the two peaks
Flags	A close outside the trendline boundary
Flags, High and Tight	A close outside the trendline boundary or highest peak in the pattern
Head-and-Shoulders Tops and Complex Tops	A close below the upsloping neckline, or a –close below the low between the head and right shoulder for downsloping necklines
Measured Move Down or Up	Not applicable
Pennants	A close outside the trendline boundary
Pipe Bottoms	A close above the highest spike in the pattern
Pipe Tops	A close below the lowest spike in the pattern
Rounding Bottoms	A close above the right lip
Scallops, Ascending ...