Trend Reversal – Bullish

Developed by Definedge.

Bullish Trend Reversal is a four-line pattern of the Line Break chart.

It is a typical Three-line break reversal pattern and named as Trend Reversal because unlike other patterns previous three lines in this case is in the same direction so there was a trend before reversal.

When a bullish line appears that goes above the high point of previous three bearish lines, it is marked as a bullish trend reversal pattern.

All trend reversal patterns are Change of Line formations as well but not all Change of Line formations are trend reversal patterns. Any pattern where previous three lines before reversal are not in the same direction is not a trend reversal pattern.

Prashant Shah introduced this concept in a research paper and his book on the Line Break Charts by Prashant Shah, available for free on Shelf.

Click here to know 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.