Reversal Patterns

Reversal Patterns finds the classic reversal shapes in the market's recent swing highs and lows. Head and Shoulders is three highs with the middle one highest. Double and Triple Tops are two or three highs at the same level. The Quasimodo is an uneven head and shoulders whose right shoulder falls short of the left. Each is mirrored for bottoms.

It carries three detectors in one script, each with its own toggle, and all three are on by default. A confirmed pattern is drawn with its outline, its neckline, a label and a marker.

Reversal Patterns combines 3 tools in one script. Each one has its own switch in the settings.

• Head and Shoulders. The three-swing reversal, left shoulder, higher or lower head and right shoulder at the first level, confirmed by a neckline break.
• Double/Triple Tops. Two or three swing highs or lows at the same price, confirmed by a neckline break.
• Quasimodo. An asymmetric head and shoulders where the right shoulder falls short of the left.

• The neckline break. A pattern only counts once price closes through its neckline. Before that, a head and shoulders is just three highs.
• Head and shoulders. A higher head between two shoulders at a similar level. A close below the neckline is the bearish confirmation; the inverse pattern is bullish.
• Double and triple tops. Price failing at the same level two or three times. A close through the low between the last two highs confirms it.
• Quasimodo. The right shoulder undercuts the left, so weakness shows earlier than in a standard head and shoulders.

Components

Structure

Settings

Head and Shoulders

Double/Triple Tops

Quasimodo

Display

Colours

Alerts: head_and_shoulders, inverse_head_and_shoulders, double_top, double_bottom, triple_top, triple_bottom, qm_bearish, qm_bullish.

All three detectors read the same list of confirmed swing highs and lows. Head and Shoulders looks for a higher middle high with outer highs close to each other, with closeness measured against the average true range. Its neckline is a sloped line joining the two lows between them. Tops look for two or three highs within a tolerance, with the neckline at the lowest low between the last two.

The Quasimodo looks for three highs with a higher middle one and a right high below the left. Its neckline is the low between the head and the right shoulder.

With Require Neckline Break on, the default, a pattern is drawn and its alert fires when a bar closes through the neckline. Turn it off to see patterns before they are confirmed.

• Swing lag. Patterns are built from confirmed swings, so the latest shoulder or top is only known Swing Length bars after it formed.
• Confirmation comes late by design. With the neckline rule on, the pattern appears after the break. Part of the move has already happened.
• Tolerance shapes what you see. The shoulder and top tolerances decide what counts as the same level. Loose values find more patterns of lower quality.
• Neckline breaks fail. Price can close through a neckline and return. The script does not follow the pattern after confirmation.
• It is not a strategy. There is no target or stop attached to a pattern.

Premium scripts are a one-time purchase in the Altrady marketplace and need a paid Altrady plan to run.

• Continuation Patterns. Triangles, wedges and flags or pennants found automatically from swings and confirmed when price closes through the pattern's boundary.
• Harmonic Patterns. Gartley, Bat, Butterfly and Crab harmonics and the ABCD measured move, found automatically from swing pivots with the potential reversal zone at D.
• Divergence. Regular and hidden divergences between price and an oscillator at swing pivots, marked on the chart with a line between the two pivots.
• Confluence Scorer. A score from 0 to 1 for how many of six signals agree on direction, covering trend, momentum, volume, support and resistance, structure and displacement.