According to Mr. Bulkowski these are pipes. That is why I started this thread with the hope of making some sense of it all. The one on the S&P500 I came up with. I did not try to go back--just called it from the time I saw it.

Here is a chart of the last of the four pipetops identified this week (POL).

i know weve talked about this before, but why not enter at the close of the day where you know the days bar is going to close correctly for an entry? i feel like you would be giving up any type of gap or whatever when you enter on the open of the bar after the confirming bar..

I agree with you madLyfe that this would be a better way to trade the pattern. The problem is that I am not in a position to do so. My job keeps me away from being able to monitor the market.

I am working on a way to identify the pipe pattern over the weekend (from the past two weeks) and if I have the weekly set up then using the daily timeframe to trigger the trade.

When I have the ability to monitor the market like I want to then I will be able to monitor/trade the shorter timeframes.

Don

Four pipetops sold short on April 17, 2012. Three are losing positions so far and one is winning.

Bought S&P 500 on December 26, 2011. Currently sitting on 11.36% Gain.

With all five positions considered, the Pipes portfolio has a 10.18% gain.

Charts and portfolio attached below.

Don

DonStar 

Four pipetops sold short on April 17, 2012. Three are losing positions so far and one is winning. Bought S&P 500 on December 26, 2011. Currently sitting on 11.36% Gain. With all five positions considered, the Pipes portfolio has a 10.18% gain. Charts and portfolio attached below. Don

I'm glad your making out overall... some of those that are backing up on you looked kind of like weak setups to me.
Mainly the size of the formations (pipes) would tend to scare me away.

Thanks kbit!

Great point. I started this thread with the hope that I could work out a system to make pipes more profitable.

How would you define a "strong" setup as opposed to a "weak" setup?

Two stocks were identified to have pipe bottom formations this week.

DNDN
BBH

Both have confirmed buy signals by closing abobe the trigger line (the highest high of the two pipes).

Buy at market orders will be placed for Monday's open.

Don

DonStar 

Thanks kbit! Great point. I started this thread with the hope that I could work out a system to make pipes more profitable. How would you define a "strong" setup as opposed to a "weak" setup?

Well I guess if the pipes were at least the same size or larger than the previous candles it would be stronger in my view....the ones you have selected seem a bit on the small size to me.

In addition to that is location, though I suppose it's not that critical here but as you are aware no doubt the ones that occur at the very bottom of the larger swings are probably the best. I only mention it just for the record.

Like I said in the beginning of your thread I am not an expert on pipe bottoms, I'm just basing this on my general experience.

DonStar 

Two stocks were identified to have pipe bottom formations this week. DNDN BBH Both have confirmed buy signals by closing abobe the trigger line (the highest high of the two pipes). Buy at market orders will be placed for Monday's open. Don

These two look good if for no other reason that they are engulfing bars ....and the second seems "good sized".