As of 11/20/2019
  Indus: 27,821 -112.93 -0.4%  
  Trans: 10,695 -152.59 -1.4%  
  Utils: 855 +6.70 +0.8%  
  Nasdaq: 8,527 -43.93 -0.5%  
  S&P 500: 3,108 -11.72 -0.4%  
YTD
 +19.3%  
 +16.6%  
 +19.9%  
 +28.5%  
 +24.0%  
  Targets    Overview: 11/14/2019  
  Up arrow28,200 or 27,100 by 12/01/2019
  Up arrow11,400 or 10,600 by 12/01/2019
  Up arrow870 or 800 by 12/01/2019
  Up arrow8,700 or 8,200 by 12/01/2019
  Up arrow3,200 or 3,025 by 12/01/2019
As of 11/20/2019
  Indus: 27,821 -112.93 -0.4%  
  Trans: 10,695 -152.59 -1.4%  
  Utils: 855 +6.70 +0.8%  
  Nasdaq: 8,527 -43.93 -0.5%  
  S&P 500: 3,108 -11.72 -0.4%  
YTD
 +19.3%  
 +16.6%  
 +19.9%  
 +28.5%  
 +24.0%  
  Targets    Overview: 11/14/2019  
  Up arrow28,200 or 27,100 by 12/01/2019
  Up arrow11,400 or 10,600 by 12/01/2019
  Up arrow870 or 800 by 12/01/2019
  Up arrow8,700 or 8,200 by 12/01/2019
  Up arrow3,200 or 3,025 by 12/01/2019

Bulkowski's Failure Swings

 

My book, Trading BasicsTrading Basics: Evolution of a Trader book., pictured on the left, discusses failure swings starting on page 90 in the section titled, "7. Good Eggs: Indicator Failure Swings."

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

-- Tom Bulkowski

$ $ $

Failure swings are chart patterns that appear on indicator lines. They are small M or W shaped patterns that reliably signal short-term price turning points.

M-shaped Failure Swings
W-shaped Failure Swings
Other Examples
See Also

 

M-Shaped Failure Swings

M-shaped failure swings

Look for M-shaped failure swings that span the trigger line in the indicator. The chart to the right shows the Wilder relative strength index (RSI) with the failure swing spanning the 70 overbought signal line (the horizontal line at 70).

The stock begins its turn as the failure swing forms. Notice that the second peak of the failure swing doesn't rise above the first peak. It fails to swing higher, indicating a weakening technical picture and a potential trend change.

The example pictured is taken from an actual stock/indicator pair. Various shapes for the failure swing appear to the left in the chart. Some analysts argue that the failure swing must span the trigger line (70), but you can find numerous examples where that is not the case and yet price changes trend. Failure swings occur in indicators other than the RSI, too.

 

Top of page More

W-Shaped Failure Swings

W-shaped failure swings

Look for W-shaped failure swings that span the trigger line in the indicator. The picture to the right shows the Wilder relative strength index ( RSI) with the failure swing spanning the oversold signal line (the horizontal line at 30).

The stock begins its turn as the failure swing forms. The example shown in the chart is taken from an actual stock/indicator pair. Various shapes for the failure swing appear to the left.

Some analysts argue that the failure swing must span the trigger line (30), but you can find numerous examples where that is not the case and yet price changes trend. Failure swings also occur in indicators other than the RSI.

-- Thomas Bulkowski

Other Failure Swing Examples

Top of page More

See Also

 

Support this site! Clicking any of the books (below) takes you to Amazon.com. If you buy ANYTHING while there, they pay for the referral.

My novels:      New                  Bumper's Story Head's Law

Chart Patterns: After the Buy Getting Started in Chart Patterns, Second Edition Trading Basics Fundamental Analysis and Position Trading Swing and Day Trading Visual Guide to Chart Patterns Encyclopedia of Candlestick Charts Encyclopedia of Chart Patterns 2nd Edition Trading Classic Chart Patterns

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