Saucers and Spikes Price Patterns

Although not seen as frequently, reversal patterns sometimes take the shape of saucers or rounding bottoms. The saucer bottom shows a very slow and very gradual turn from down to sideways to up. It is difficult to tell exactly when the saucer has been completed or to measure how far prices will travel in the opposite direction. Saucer bottoms are usually spotted on weekly or monthly charts that span several years. The longer they last, the more significant they become.

Spikes are the hardest market turns to deal with because the spike (or V pattern) happens very quickly with little or no transition period. They usually take place in a market that has gotten so overextended in one direction, that a sudden piece of adverse news causes the market to reverse direction very abruptly. A daily or weekly reversal, on very heavy volume, is sometimes the only warning they give us. That being the case, there's not much more we can say about them except that we hope you don't run into too many of them.