Descending Scallop / ディセンディングスキャロップ
Reference values based on Bulkowski's "Encyclopedia of Chart Patterns". Data is primarily from U.S. markets and may differ for other markets.
A pattern where an inverted U-shaped rounded top forms during a downtrend, after which the trend continues. A rally from a low creates a gentle curve to find a top, then declines back below the previous low to complete the pattern. This is the inverse of the ascending scallop, suggesting bearish trend continuation.
Enter short when price clearly breaks below the previous low on a closing basis. A volume-accompanied breakout after confirming the inverted U-top reversal is more reliable.
Project the range from the scallop's low to its top downward from the breakout point (previous low). For example: low at 1000, top at 1120, range of 120, target at 880.
Place a stop-loss slightly above the inverted U-top's highest point. Or project 50% of the scallop's range upward from the breakout point.
Volume decreases during the rally and increases during the renewed decline. A volume surge when breaking below the previous low enhances reliability.