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Trader Vic 123 Reversal Pattern Setup
more examples 2/6/03
(as described by Vic Sperandeo
in "Trader
Vic: Methods of a Wall Street Master")
1.
trend line broken
2. lower high in an uptrend, or a higher low in a downtrend.
3. break below the previous low in an uptrend, or above the previous high in a
downtrend
At point 3 the reversal is
confirmed and everybody's brother is getting short.
A stop run often follows to
re-test the penetration at point 3.
Quicker traders may get short at the X, or
even closer to the 2 based on other indicators (divergence, Fibonacci retracement,
Bollinger band touch, etc.)
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