Upthrusts - Chart Reversal Pattern
An upthrust is a false breakout through a horizontal resistance area. The concept was first developed by Richard Wyckoff, who was one of the great stock operators from the early 19th century. The key component is an increase in volume on the false break of resistance and the subsequent return under the old high. The target for an upthrust is the low of the range preceding the false breakout. A stop loss can be placed slightly above the high of the upthrust bar. A knowledge of upthrusts can turn a false breakout into a profitable trading opportunity.