First Swing Point High
Note: The historical stock examples given below are for EDUCATIONAL USE ONLY. They ARE NOT to be used to make buy/sell decisions in today's market. For more information, please read the HSR Terms of Use.
Description
After hitting a new high, price makes a lower high AND closes below the lowest price of the highest week for the first time since breaking out of a base.
Behavior Notes:
- Swing points need confirmation. The week that closes below/above the lowest/highest price of the highest/lowest week is called the confirmation bar (CB) because it confirms the swing point.
- Confirmation of a swing point high can take place at any time after the new high. The only requirement is that a higher high (new high) isn't made before the swing point is confirmed.
- Swing Point High (SPH) signals are common within uptrends. You have to be careful putting too much weight into a SPH that occurs shortly after a base breakout. In general, you want to look for First SPHs (fSPH) in stocks that have had a large advance and are very extended from their last base without ever registering a swing point high.
What you need to know
A swing point high is a price behavior that indicates a potential change in direction.
First Swing Point Highs represent a change in a stock's character that may alert you before price breaks its 10 Week MA.
It's important to note that not all tops show signs of distribution before price breaks lower.
In some cases, the First Swing Point High signal may be the only warning sign before a stock rolls over.
Historical Stock Chart Examples 1A & 1B: Key Energy Services (KEG) 1997
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Click to enlarge 1A
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Click to enlarge 1B
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To learn more about First Swing Point Highs, please click here.
Please >>CLICK HERE<< to go to the next price behavior within Topping Behaviors.
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