REVERSAL SIGNAL

21 February 2017 By PDSNET

A term used in technical analysis to describe a formation found either at the top or bottom of a trend which signals that the trend is about to be reversed. Candlestick formations commonly form reversal signals. It is however always best to wait for a confirmation signal before acting on a candlestick reversal signal. There are other forms of reversal formations such as the head and shoulders formation, the double bottom or top formation and the island formation, to name a few.



Share this glossary term: