As of 08/23/2019   Indus: 25,629 -623.34 -2.4%     Trans: 9,740 -333.41 -3.3%     Utils: 832 -8.66 -1.0%     Nasdaq: 7,752 -239.62 -3.0%     S&P 500: 2,847 -75.84 -2.6%	YTD  +9.9%    +6.2%    +16.7%    +16.8%    +13.6%	Targets    Overview: 08/15/2019     27,200 or 24,900 by 09/01/2019   10,700 or 9,550 by 09/01/2019   850 or 790 by 09/01/2019   8,200 or 7,400 by 09/01/2019   3,000 or 2,750 by 09/01/2019
Chart pattern indicator: on 8/21/19

As of 08/23/2019   Indus: 25,629 -623.34 -2.4%     Trans: 9,740 -333.41 -3.3%     Utils: 832 -8.66 -1.0%     Nasdaq: 7,752 -239.62 -3.0%     S&P 500: 2,847 -75.84 -2.6%	YTD  +9.9%    +6.2%    +16.7%    +16.8%    +13.6%
Targets    Overview: 08/15/2019     27,200 or 24,900 by 09/01/2019   10,700 or 9,550 by 09/01/2019   850 or 790 by 09/01/2019   8,200 or 7,400 by 09/01/2019   3,000 or 2,750 by 09/01/2019
Chart pattern indicator: on 8/21/19

Bulkowski's Ascending and Inverted Scallops

Statistics updated on 3/20/2019.

For more information on this pattern, read Encyclopedia of Chart Patterns Second Edition, pictured on the right, pages 639 to 653. That chapter gives a complete review of the chart pattern, compared to what is described below.

If you click on this link and then buy the book (or anything) at Amazon.com, the referral will help support this site. Thanks. -- Tom Bulkowski

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Ascending and Inverted Scallop Overview

The inverted and ascending scallop looks like the right half of an umbrella. The beauty of this chart pattern is that it performs so well in both bull and bear markets, sporting a low break even failure rate and a large average rise.

Discovered by Thomas Bulkowski in the early 2000's but it may have been uncovered by others earlier.

Important Bull Market Results for Ascending and Inverted Scallops

The above numbers are based on 1,748 perfect trades. See the glossary for definitions.

Ascending and Inverted Scallop Identification Guidelines

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Ascending and Inverted Scallop Trading Tips

Consult the associated figures on the right.

Trading Tactic Explanation Measure rule Compute the height from the highest peak (B) to the lowest valley in the pattern (A) and then multiply it by the above 'percentage meeting price target.' Add the difference to the highest peak (B) to get a price target C. The link to the left provides more information on the measure rule. Stop If price drops below the right scallop edge, sell. See the measure rule figure to the right for the proper stop location. Buy Buy when price closes above the highest peak in the pattern (B). Swingers Swing traders will want to buy when price bottoms on the right and sell when it climbs to the top of the pattern. Avoid If price drops below the start of the pattern (A), then avoid this one. Avoid valley If price forms a distinct right valley and then price drops below the valley, sell. The figure to the right ("New Stop Location") shows the proper location for a stop in this situation. Breakout volume Heavy breakout volume suggests better performance. The link shown to the left discusses statistics on breakout volume. The following link gives additional information on other chart patterns that also do well after heavy breakout volume.

The Measure Rule New Stop Location

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Ascending and Inverted Scallop Example

The figure on the right shows an example of an inverted and ascending scallop chart pattern. Price bottoms at point A and then rises to B where it rounds downward to C.

To calculate a price target, subtract the price of valley A from peak B. That finds the height. Multiply the height by 61% (the percentage meeting price target from Important Bull Market Results table near the top of this page) and add the result to the price at B. Place a stop loss order a few pennies below C, and raise the stop as price climbs.

-- Thomas Bulkowski

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Other Ascending and Inverted Scallop Examples

• Inverted and ascending scallop in the Dow industrials, March 2011.

 

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