Learn / Buy and sell signals
High Poles and Low Poles
Sharp columns that give back more than half their move.
A pole is a long, sharp column that quickly gives back more than half of its move. It's a warning that the move may have been an exhaustion rather than the start of a trend.
High Pole (a warning for longs)
The rule: an X column rises at least three boxes above the previous X column's top, then the next O column retraces more than half of that X column.
The rally broke out strongly, but sellers stepped in just as strongly. Giving back more than half the column suggests the buying was a burst rather than sustained demand. The High Pole is a reason for caution or for tightening stops.
Low Pole (a warning for shorts)
The rule: an O column falls at least three boxes below the previous O column's bottom, then the next X column recovers more than half of that O column.
The selloff may have been a capitulation. A strong rebound that recovers more than half the drop shows buyers absorbing the supply, and the Low Pole is generally viewed as constructive.
How to measure "more than half"
Count the boxes in the pole column. If an X column has 10 boxes, the High Pole is complete when the O column reaches below the 5th box from the top, more than 5 boxes down.
For education only. Nothing here is investment advice or a recommendation to buy or sell any security.