Inverse Saucer

AAA

DEFINITION of 'Inverse Saucer'

A technical chart formation that indicates the stock's price has reached its high and that the upward trend has come to an end. An inverse saucer is characterized by a steady flattening of the uptrend to such a degree that the market at one moment enters a sideways range, but then slowly starts to fall slowly and finally accelerates downward. This rare formation provides no clear price target but usually implies quite a lot of potential since 50% or more retracement of the preceding uptrend can be expected. Also known as "rounded top".

Inverse Saucer

INVESTOPEDIA EXPLAINS 'Inverse Saucer'

Inverse saucers occur as expectations gradually shift from bullish to bearish. The gradual yet steady shift forms a rounded top. Volume during inverse saucers often mirror the bowl-like shape of prices during a saucer - volume, which was high during the previous trend, decreases as expectations shift and traders become indecisive. Volume then increases as the new trend is established.

RELATED TERMS
  1. Cup and Handle

    A pattern on bar charts resembling a cup with a handle. The cup ...
  2. Head And Shoulders Pattern

    A technical analysis term used to describe a chart formation ...
  3. Indicator

    Statistics used to measure current conditions as well as to forecast ...
  4. Volume

    The number of shares or contracts traded in a security or an ...
  5. Technical Analysis

    A method of evaluating securities by analyzing statistics generated ...
  6. Retracement

    A temporary reversal in the direction of a stock's price that ...
Related Articles
  1. Forex Education

    How To Interpret Technical Analysis Price Patterns: Triple Tops And Bottoms

    Triple and double tops and bottoms may be tough to spot, but once you learn them, they can be powerful patterns.
  2. Options & Futures

    How To Use Volume To Improve Your Trading

    Volume is a simple yet powerful way for traders and investors to increase their profits and minimize risks.
  3. Trading Strategies

    How To Trade The Head And Shoulders Pattern

    The head-and-shoulders chart pattern is a popular and easy-to-spot pattern - once a trader is aware of what they are watching for.
  4. Trading Strategies

    Introduction To Technical Analysis Price Patterns

    To "find your game" in technical analysis, you need to be able to recognize reversals and continuations as they form.
  5. Trading Strategies

    What does a double bottom tell a trader about the overall trend?

    Learn how a double bottom pattern forms on a price chart and why many traders consider double bottoms to be a sign of reversal in the price trend.
  6. Trading Strategies

    What are the main differences between a double top and a double bottom?

    Identify double tops and double bottoms, and learn what each could mean for the security's current price trend. Discover how other indicators verify movements.
  7. Technical Indicators

    What are common trading strategies used when identifying a double bottom

    Use simple, low-risk trading strategies to take advantage of a double bottom formation. Traders typically take one of these approaches to buying the market.
  8. Technical Indicators

    What is a common price target when identifying a double bottom?

    Learn how to identify a double bottom stock pattern and where to set a target selling price point to get the most out of your investment.
  9. Forex Strategies

    Are Doji patterns important when trading forex pairs?

    Find out why forex traders make heavy use of candlestick patterns such as the doji, which can be used as a signal of market indecision and coming breakout.
  10. Trading Strategies

    How effective are double tops in spotting a change in the overall trend?

    Learn about the double top price chart pattern, a commonly appearing indicator used to establish resistance levels and possible trend reversals.

You May Also Like

Hot Definitions
  1. Commodity

    1. A basic good used in commerce that is interchangeable with other commodities of the same type. Commodities are most often ...
  2. Deferred Revenue

    Advance payments or unearned revenue, recorded on the recipient's balance sheet as a liability, until the services have been ...
  3. Multinational Corporation - MNC

    A corporation that has its facilities and other assets in at least one country other than its home country. Such companies ...
  4. SWOT Analysis

    A tool that identifies the strengths, weaknesses, opportunities and threats of an organization. Specifically, SWOT is a basic, ...
  5. Simple Interest

    A quick method of calculating the interest charge on a loan. Simple interest is determined by multiplying the interest rate ...
  6. Special Administrative Region - SAR

    Unique geographical areas with a high degree of autonomy set up by the People's Republic of China. The Special Administrative ...
Trading Center