Island Reversal

An island reversal is identified by gaps between the signal day and the days on either side. This is a strong short-term signal.

After an up-trend:

After a down-trend:

Island Clusters

Even stronger signals are island cluster reversals where an island is formed by several bars rather than one.

The signals are most reliable if they occur after a strong trend. If the trend is weak, so is the signal.

Title	Description
Reversal Days	Every trend change is signaled by a reversal day. The secret is to identify their potency.
Closing Price Reversal	A powerful reversal signal, especially with a large spike after a strong advance...
Hook Reversal	An inside day that signals a fairly weak reversal...
Key Reversal	Key reversal signals do not occur very often but are definitely worth the wait...
Open-Close Reversal	Open-Close reversals are potent reversal signals when they follow a strong trend.
Pivot Point Reversal	Pivot point reversals are the simplest and most commonly encountered of all reversal signals.