Education & Information
Sell Signals
Bullish Signal Reversal
The bullish signal reversal pattern is one of the rarest point & figure patterns. It consists of at least seven columns. The first six show higher columns of Xs and higher columns of Os creating bullish signals on the chart. During the seventh column or thereafter the bullish pattern is broken when a column of Os drops below the previous column of Os reversing the bullish pattern. Similar to the bearish signal, this pattern should be treated differently depending on the major overall trend present in the stock. If the stock is trading below the bearish resistance line, a bullish signal reversal represents that a short-term advance in the stock is over and the main trend is reemerging. If it happens while the stock is trading above the bullish support line, the bullish signal reversal suggests that the stock’s decline should stop at the support line.