Learn / Buy and sell signals
Bullish and Bearish Catapults
A triple breakout followed by a double breakout.
A Catapult combines two signals in a row: a Triple Top (or Bottom) breakout, a pullback that holds, and then a fresh Double Top (or Bottom) signal. It shows a breakout that was tested and then confirmed.
Bullish Catapult
The rule: a Triple Top buy signal, followed by a column of O's that does not give a sell signal, followed by a Double Top buy signal as the next X column rises above the Triple Top breakout column.
After the Triple Top, profit-taking pulls price back. The important thing is that the pullback holds, usually near the old resistance level, which is now acting as support. When the next X column breaks above the breakout high, the original breakout is confirmed. The second signal is the "catapult."
Bearish Catapult
The rule: a Triple Bottom sell signal, followed by a column of X's that does not give a buy signal, followed by a Double Bottom sell signal as the next O column falls below the Triple Bottom breakdown column.
The bounce after the breakdown fails, often near the old support level, which now acts as resistance. The second breakdown confirms the first.
Using Catapults
- The Catapult gives a second chance at a breakout you may have missed, with a clear reference point: the pullback low.
- If the pullback after a Triple Top falls far enough to give a Double Bottom sell signal, there's no Catapult. The breakout has failed.
For education only. Nothing here is investment advice or a recommendation to buy or sell any security.