Follow through -Bearish

Developed at Definedge.

Through this method, the basic double bottom sell bearish breakout pattern on the P&F chart can be made powerful.

A basic double bottom sell pattern followed after a significant bearish pattern provides confirmation to the major patterns. It is not an ordinary bearish breakout pattern because it has occurred after a major bearish pattern. It helps in filtering multiple stocks where bearish double bottom sell pattern has got triggered and it also confirms the bearishness of the major pattern that got formed.

After the bearish major pattern breakout, price retraces a bit followed by a bearish double bottom sell signal provides confirmation of the bearish environment and shows the weakness of bulls. It offers the bearish trade opportunity and the initial risk can be defined by deciding on the number of boxes in the column of ‘X’ before the breakout.

Prashant Shah introduced this concept and explained this pattern in his book on Point & Figure charts.

Click here to read 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.