Diamond Pattern

Diamond is a combination of triangle and broadening pattern. The pattern consists of eight columns.

Bullish or bearish broadening followed by a triangle pattern is a Diamond pattern.

Diamond pattern shows volatility expansion followed by convergence. It indicates a major shift in stock owners – possibility from weak hands to strong hands.

The pattern is relatively rare, however strong trends may emerge after this pattern.

Read the Diamond follow-through pattern.

Prashant Shah introduced this pattern in his P&F book.

Click here to learn more about the pattern.

This pattern can be plotted on the chart by adding it from the Add study menu in TradePoint & Patterns in RZone. The pattern is also available in the System Builder section. By combining this pattern with other patterns and indicators, you can create your own trading strategies. For any group of stocks and market segments, you can scan and backtest stocks based on those strategies.