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Flashcards in Point and Figure Deck (7)
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1

Vertical Count (3-Box Reversal)

1. Vertical count begins from established support or resistance

  • First column of X's after major low (long column of O's)
  • or Second column of X's after major low if first column was short (3-5 boxes)
  • or Column of X's after mini-bottom (a double bottom sell)
  • or Column of X's that creates significant breakout 

2. Count the number of boxes in the support (XXX) column

3. Add the # of boxes X reversal X box size to the lowest O of the column to the left of the count column.

2

Stop Loss on Vertical Count (3-box reversal)
Same for Horizontal Count

SL = the point where a new sell signal appears. This is a new low below the price that established support.

3

Horizontal Count (3-Box Reversal)

1. Count # of columns between 0 that started the pattern and the X that broke out. 

2. Multiply count by box size and reversal and add to the base (lowest point) of the consolidation.

4

Does Horizontal Count Validate Vertical Count?

- If horizontal count is larger than vertical then the vertical count is validated and should be the initial estimate.

5

Trendline break validity

1. Price must close above (below) the trendline - not on the trendline drawn through the box.

2. Both the start and finish of the box must be above/below the trendline.

6

4 Methods for establishing horizontal counts (1-box reversals)

1. Find row with the most activity = width of the pattern = anchor point for projections

2. Cound the width of all rows in pattern / number of rows  = width of pattern = anchor width calculation to the middle row.

3. Count number of columns between and including the "walls" of the pattern starting with the beginning of the right-hand wall = width = attach width calculation to the base of the exit column / method 3 and 1 often line up

4. Count the width of the pattern at the breakout or catapult point. If there are walls, it will be the width between and including the walls. = Anchor width calculation to the breakout box.

7

3-box Reversal Double Tops

Double Top