I'm not a pattern trader. I look at the internal strength and weakness within the price movement; seeking opportunity at places of traps or weakness against the bias.
But there are some patterns that are based around similar concepts, such as the Wyckoff Spring and Upthrust. If you trade patterns, these are two which you should have in your trading arsenal.
I recently received the following message from another trader, showing an excellent example of a Spring.
Let's zoom in on the image a little:
There are two absolute facts here!
First, at around 3:20am in my timezone, this was 20 minutes after my session had finished. (I can't stay up all night!!!)
And secondly, it is a beautiful example of a spring. I immediately thought I had to share this one. Part of what appeals to me is the rather "messy" price action – it's a REAL example, not a textbook perfect example.
So let's look at the charts in a little more detail.
Higher Timeframe first in order to get a little context…
Let's now look at the Trading Timeframe…
Could the breakout have worked? Could price have fallen and held below the S/R level?
And if that was the case I'd be looking for a breakout pullback trade setup on retest of the level.
But my thoughts on a break such as this are always "watch for failure"!
A rapid rejection of an obvious level of support can provide great trade opportunity LONG.