Reversal bars
A bullish reversal bar is a bar with its low making a new low but closing higher. A bearish reversal is a bar where there’s a new high but with the closing lower. Those reversals aren’t significant unless in context with highly oversold or overbought situations.
Key reversal bar
A bullish key reversal is a bar with new lows and then making a high higher high, closing, also, higher than the previous bar’s close. The bearish key reversal is its specular pattern.
From lower to higher or vice versa.
The most important pattern for determining a trend reversal has already been dealt with. Since a trend reversal -for instance from bear to bull trend- is going from lower highs and lows to higher highs and lows, this is a pattern, and it’s one of most important for the detection of a trend change.
It’s possible that we may detect a failure to new lows, but we don’t start getting higher highs and lows. Thus, we have shifted from a downtrend to a sideways market, that may resume a downtrend or break up. We still don’t know. But the bear trend has stopped.
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