Technical Analysis Trading Methods and Techniques (Collection)

Chapter 5. A Domed House

“The most typical Three Peak-Domed House formations start at a bear market low. When this has been true, the highest point in the pattern has never equaled the top of the previous major bull market. Not all of the minor bull markets of the past have taken the shape of the Three Peaks and Domed House, but most of them have.”¹ —George Lindsay

After the Separating Decline, the Domed House formation begins (see Figure 5.1). Like the Three Peaks pattern, the Domed House pattern is “distinguished by advances and declines which travel many points in a straight line. But the movements never last very long. In between the few explosive moves, the market spends much of the time backing and filling in a comparatively narrow range.” ...