As of 10/11/2019   Indus: 26,817 +319.92 +1.2%     Trans: 10,292 +224.65 +2.2%     Utils: 867 -5.54 -0.6%     Nasdaq: 8,057 +106.26 +1.3%     S&P 500: 2,970 +32.14 +1.1% YTD  +15.0%    +12.2%    +21.6%    +21.4%    +18.5% Overview: 09/30/2019     27,600 or 25,600 by 10/15/2019   11,100 or 9,700 by 10/15/2019   900 or 850 by 10/15/2019   8,300 or 7,700 by 10/15/2019   2,825 or 3,050 by 10/15/2019
 As of 10/11/2019   Indus: 26,817 +319.92 +1.2%     Trans: 10,292 +224.65 +2.2%     Utils: 867 -5.54 -0.6%     Nasdaq: 8,057 +106.26 +1.3%     S&P 500: 2,970 +32.14 +1.1% YTD  +15.0%    +12.2%    +21.6%    +21.4%    +18.5% Overview: 09/30/2019     27,600 or 25,600 by 10/15/2019   11,100 or 9,700 by 10/15/2019   900 or 850 by 10/15/2019   8,300 or 7,700 by 10/15/2019   2,825 or 3,050 by 10/15/2019

# Bulkowski's Measure Rule

My book, Encyclopedia of Chart Patterns Second Edition, pictured on the left, has the measure rule statistics for most of the 63 chart and event patterns covered by the book.

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

\$ \$ \$

Use the measure rule to predict a price target. The rule varies from chart pattern to pattern as the below table shows. Usually the measure rule is the height added to (upward breakouts) or subtracted from (downward breakouts) the breakout price.

Unfortunately, that formula doesn't work well. Instead, multiply the height by the "percentage meeting price target," which I show in the below table as percentages. The result should be a closer and more accurate price target.

For example, if a broadening top has a high price of 25 and a low of 20 with a breakout of 22, an upward breakout target in a bull market would be B + ((H - L) * 62%) = 22 + ((25 – 20) * 62%) = \$ 25.10. A downward breakout in a bull market would use the formula B - ((H - L) * 37%) = 22 – ((25 – 20) * 37%) = \$ 20.15.

The formula may look complex but it's not. Anyone with a doctorate in mathematics can figure it out in a few hours.

-- Thomas Bulkowski

Notes:

B = The breakout price which is where price pierces a trendline.
CBG = The closing price before a gap.
CPH = The highest price in the corrective phase.
CPL = The lowest price in the corrective phase.
H = Price of the highest peak in the chart pattern
L = Price of the lowest valley in the chart pattern
H – L is the price of the highest peak minus the price of the lowest valley.
HL = Lowest price in the head.
HH = Highest price in the head.
NL = Neckline, measured vertically from the peak or valley in the head.
RL = Price of the right saucer lip.

## Measure Rule in Bull Markets

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