|
Written and copyright © 2008-2011 by Thomas N. Bulkowski. All rights reserved.
See page 10 of the book,
Trading Classic Chart Patterns  ,
(pictured on the right) for more information on minor highs and lows.
Minor highs are peaks and minor lows are valleys on the price chart. Below are some tips for
selecting minor highs and lows.
New research suggests that when a tall price
bar (candle line) forms in an uptrend or downtrend, a reversal is likely (forming a minor high or low). For details,
see Candles at peaks and valleys.
Minor Highs
 Minor highs
|
The above figure shows what
most chartists call minor highs. Think
of minor highs as price peaks in a mountain
range of prices.
The odd numbers
in the figure show distinct price peaks in which price makes a lower high to each
side of it. Even points 2, 4, and 6 are
minor highs because they are the highest peak in several days. A good guideline is
to find peaks that have no higher price
within 5 days surrounding the peak. That's 2 days before to 2 days after the
tallest peak.
Minor Lows
 Minor lows
|
The above figure shows minor lows. Think of minor lows as price valleys.
The even numbers show distinct
valleys but what about point 5? If you use a 5-day window (2 days before to 2 days
after) then point 4 shows a lower valley.
Thus, point 5 is probably not a minor low but one that is part of point 4.
In some cases, such as when
searching for an Eve peak or valley (see the Adam and Eve combinations of double
tops or bottoms) you might want to consider
valleys 4, 5, and 6 as a major low – a large rounding turn composed of a few
minor lows.
The most important considerations
for finding minor highs and minor lows is that you are looking for peaks and
valleys, ones that are distinct and well separated.
-- Thomas Bulkowski
Copyright © 2008-2011 by Thomas N. Bulkowski. All rights reserved. Bugs are sons-of-glitches.
|
. If you buy ANYTHING, they pay for the referral.
on 