Point & Figure charts consist of columns of X's and O's that represent filtered price movements. X-Columns represent rising prices and O-Columns represent falling prices.
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Point & Figure Horne Page Point
Point & Figure Chart BasicsIntroductionPoint & Figure charts consist of columns of X's and O's that represent filtered price movements. X-Columns represent rising prices and O-Columns represent falling prices. Each price box represents a specific value that price must reach to warrant an X or an O. Time is not a factor in P&F charting. These charts evolve as prices move. No movement in price means no change in the P&F chart. In classic 3-box reversal charts, column reversals are further filtered requiring a 3-box minimum to reverse the current column. The 3-box Reversal Method is the most popular P&F charting method. Articles in the StockCharts.com ChartSchool are base on this method. P&F charts provide a unique look at price action that has several advantages. P&F charts: Filter insignificant price movements and noise Focus on important price movements Remove the time aspect from the analysis process Make support/resistance levels much easier to identify Provide automatic and subjective trendlines
echnology Select Sector SPDR (XLK) NYSE 31-Mar-2011, 14:52 ET, daily, 0;26.07 H;26.15 L;26.02 C;26.09 V;4,010,860 Chg;-0 .. 2 0 User-Defined, (0.50 x 3) chart Bullish Price Obj. (Revised): 39.00 C StockCharts.com28.50 28.00 27.50 27.00 26.50 26.00 25.50 25.00 24.50 24.00 23.50 23.00 22.50 22.00 21.50 21.00 20.50 20.00 19.50 19.00 18.50 18.00 17 .50 17.00 16.50 16.00 15.50 15.00 14.50 14.00 13.50 13.00 12.50 12.00 11.50 11.00
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Classic Text P&F Chart+ + x + 56+ x 0 + X 0 + 4 0 X + + + o o o o o 0 x x x x x + 0 0 0 0 0 + +
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+ 1 +
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x C x 0x 0x x x a 0 x 0 x 0 x 0 x 8 xA030xO 6 0 X 0 9
o x 3 OX + +- 0 X 0
9 2 0 0 o x 0 I 8 7 + x + x I + + 7 I + A + X + o x + 6 + o X 0 x + I + o X 0 x a + I + x OxOxOxO 4 + I OXOxOxO x I x x + o X 0 o x 0 x C 1 X 0 X + 0 o x 0 x 0 x 0 2 0 X + 0 o x 0 x 0 Ox + 0 o x o x + 0 J + I I + I
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28,50 28.00 27.50 27.00 26.50 26.00< 25.50 25,00 24.50 24.00 23.50 23.00 22,50 22.00 21.50 21.00 20.50 20.00 19.50 19.00 18.50 18.00 17.50 17.00 16.50 16.00 15.50 15.00 14.50 14.00 13.50 13.00 12.50 12.00 11.50 11.00
+ = bearish resis~ance line + = bullish support line
HistoryP&F charting has a long history. One of the first references to Point & Figure charting came from an anonymous writer named "Hoyle", 1M'i0 wrote The Game in Wall Street and How to Successfully Play It in 1898. Early Point & Figure Charts 'lVE!re drawn using numbers. Hence, they were simply referred to as "Figure Charts". These figure charts evolved into charts with X's and a few numbers. A.W. Cohen is credited with the classic 3-box Reversal P&F charts with X's and as. Cohen wrote several books on this "Three-Point Reversal Method" and became the editor of ChartCraft. Before computers, P&F charts were popular because it was simple to maintain a large collection of charts. Using just a pencil, a newspaper and some graph paper, P&F chartists were able to update and analyze 50 or more charts every day - in less than an hour. There is a certain feel one gets lM'ien updating chart by hand. However, this classic paper and pencil-based method was largely put aside as technology made charting easier. StockCharts.com offers three different Point & Figure charting options as 'lVE!1I the ability to scan 1000s of stocks for as
Creating a P&E ChartOn a P&F chart, price movements are represented with rising X-Columns and falling Q.. Columns. Each column represents an uptrend or a downtrend of sorts. Each X or 0 occupies 'htlat is called a box on the chart. Each chart has a setting called the Box Size, 'htlich defines the price range for each box. Each chart has a second setting called the Reversal Amount that determines the amount that a stock needs to move in the opposite direction to warrant a column reversal. Whenever this reversal threshold is crossed, a new column is started right next to the previous one, only moving in the opposite direction.Afnazon.com, Inc. (AMZN) P&F PatternUselDefined. Bullish Ascending Tliple , Nasdaq Global Select II/Ikt.
31t~lal. 15:42 ET. daily. 0: 179.31. H: 181.57. L: 178.50, C: 180.495, V: 4.11\11. hg: +1.075 CTop Bleakout on 29I\I!al2011 1.0 ptsJbox 3 box leversal chart
Price Obj. (Rev.): 198.0
The "reversal distance" is the box size multiplied by the reversal amount. A box size of 1 and the reversal amount of 3 would require a 3 point move to warrant a reversal (1 x 3). An X-Column extends as long as price does not move dOIM1more than the "reversal distance". Similarly, a stock in a downtrend will cause a descending Q..Column to appear. Only 'htlen the stock changes direction by more than the reversal distance will a new X-column be added to the chart.
High-Low MethodThere are two pricing methods available: the High-Low Method and the Close Method. Each method only uses one price point. Obviously, the Close Method uses the closing price only. The High-Low Method uses the high or the low, but not both. Sometimes both are ignored. Here are the rules for the High-Low method. When the current column is an X-Column (rising):o
Use the high when another X can be drawn and then ignore the low. Use the low when another X cannot be drawn and the low triggers a 3-box reversal. Ignore both when the high does not warrant another X and the low does not trigger a 3-box reversal.
When the current column is an O-Column (failing):o
Use the low when another 0 can be drawn and then ignore the high. o Use the high when another 0 cannot be drawn and the high triggers a 3-box reversal. o Ignore both when the low does not warrant another 0 and the high does not trigger a 3-box reversal.PowerShares QQQ Trust (QQQ)
Nesdeq Global L: 57.15,
Mid. C: 57.398. V: 35.0M. Chg: +0.048
311111.11.15:33 ET. daily. 0: 57.25, No New P&F P attetn user-neflned. Bullish
1.0 ptslbox 3 box reverser chart
Price Obj. (Rev.): 89,0
I Q Understanding I ~Print
About Price Objectives
Business Machines (IBM)
NYSE c. 163.62. V: 2.21v1. Chg: +0.02
15:39 ET. daily. 0: 163.40. H: 164.06, L: 163.22. Low Pole Reversal on 21lvlaf2011 1.0 ptsJbox3 box reversal chart
Bearish Price Obj. (Rev.): 136.0
StockCharts.com P&F ChartsStockcharts.com offers three different Point & Figure charting styles: Graphical, Text and Dynamic. Graphic charts were used in the examples above. Trendlines and other indicators can be found in the Chart Overlays section just below each P&F chart. Text P&F Charts are classic old-school style with plus signs (+) marking the 45 degree trendlines. Dynamic P&F Charts allow chartists to dynamically adjust the box size, the reversal amount and draw their own trendlines. Links to the other styles can be found just above each P&F chart. Links to articles on P&F Alerts and Price Objectives can be found below each P&F chart. Click here for a live P&F chart.
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or choose from: ( Update Chart)
S&P 500 SPORs (SPY) NYSE23""'.11, 16:00 ET. d.ally. 0: 128.03. H: 130.00. L: 128.32.
V: 148,41"", Chg: +0.37
,~o New P&f Patt"nbollC Ilv.",1 ohart Bullish Puee Obj. (Rev.); 108.0 Tladition.1I.3
P&F ScansP&F Pattern Alerts can be found at end of the Predefined Scans Page. These are based on daily data. StockCharts.com provides daily alerts for more than 15 P&F patterns on various exchanges, including the TSX and LSE. Some of these are sholNll in the image below. Note that there were over 100 NYSE stocks with Triple Top Breakouts.
P&F' Patterns,P&F Bull Trap Alerts P&F Bear Trap ,Alerts,
INYSE : 11 ,: 23
: 11:12 :10:2
P&F Bulmsh Catapult ,A~erts P&F Beartslh Catapult Alerts, P&F Bullish 1iiriiangle Arerm, P&F Bearish T:ri:angle AI:erns; P&F long Ta'UDow.n p'(lerts P&F tHigh P-o:leAfelli:s, P&F low Pal'e AI~erts
:1: 30 :2
:13: 15 :4 : 133 : [63
:4: 175 , : 106,
Chartists can also scan for specific P&F patterns using daily data and the drop-down menu for user-defined scans. Over 20 P&F patterns and criteria are included as "Predefined Chart Patterns". Users can combined these P&F patterns with other non-P&F criteria to create truly unique scans.
rPredenned Chart Patterns~ -- None --,P&F Paftems. Bullish Catapult
ago is (truedays ago is
Bearish Catia\Pu~tBull. Sigma'i Reversal Bear., Signal ,Reven,a