Bump-and-Run Reversal, Bottom
3 min read
Core idea
A bump-and-run reversal bottom (BARR bottom) is the inverted version of Bulkowski's original BARR top. Visually it resembles a frying pan with the handle on the left: price declines along a down-sloping trendline (the lead-in or "handle"), accelerates downward into the bump (the bowl), then rounds upward and breaks out above the original trendline. The pattern is a study in exhausting downside momentum — initial selling pressure runs out, smart-money buyers accumulate at the lows, and the rounded recovery pulls price back to and through the lead-in trendline.
Three-phase anatomy
- Lead-in phase — price oscillates in a narrow range, sloping down at 30°-45°. A trendline drawn along the highs sets the eventual breakout level. Lead-in height (vertical distance from trendline to lowest low) is measured in the first quarter of the pattern.
- Bump phase — price plunges, often steeper than the lead-in trendline. The bump height must be at least twice the lead-in height for the pattern to qualify.
- Uphill run — rounded recovery rises and pierces the lead-in trendline upward. Volume picks up on the breakout.
Performance
This pattern ranks first or second for performance in both bull and bear markets. Average rises: ~55% in bull markets, ~35% in bear markets. Breakeven failure rates: only ~9-10%. Patterns with dual bumps (price approaches the trendline, retreats, forms a second bump, then breaks out) actually outperform single-bump versions.
Why it matters
The combination of low failure rate (~10%) and high average gain (35-55%) makes this one of the most attractive setups in the Bulkowski catalog. The pattern also gives a mechanical entry rule — close above the down-sloping trendline — and a mechanical stop level — the lowest low of the bump. Few patterns offer this level of operational clarity with this level of expected return.
Key takeaways
Mental model
Practical application
A mechanical trading plan
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Draw the lead-in trendline. Connect the highs (not lows) of the early oscillations. The line should slope down at roughly 30°-45°.
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Verify the bump. Once price plunges, measure the bump height as the vertical distance from the trendline to the lowest low. If it's not at least twice your lead-in height, abandon the pattern — it's not a BARR bottom.
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Wait for the breakout close. Enter long when price closes above the down-sloping lead-in trendline. Don't anticipate.
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Use the bowl bottom as your stop. A close below the bump's lowest low invalidates the pattern. Set your stop just below that level.
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Plan for throwbacks. Many BARR bottoms throw back to the trendline before continuing up. A throwback isn't a failure — just hold (or even add).
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Target the prior high or measure-rule projection. The pattern's strong historical performance justifies a generous profit target.
Cup-and-handle vs. BARR bottom
Example
A retail stock that traded between $40 and $48 for six months begins to slip. Highs print at $46, $44, $42 — connect them and you get a trendline sloping down at ~35°. In the first quarter of the pattern, the deepest low is $38; trendline value above it is $43, so lead-in height = $5.
Two months later the stock plunges to $30 on heavy volume, posts a bottom there, and starts rounding upward. Bump height: trendline at the bump-low date sits around $40; low is $30, giving a bump height of $10 — exactly 2× the lead-in height. The pattern qualifies.
Three weeks later, price closes at $42 — back above the down-sloping trendline. A trader enters long with a stop at $29.50 (just below the bowl). Over the next eight months the stock rises to $58, a 38% gain consistent with the bear-market historical average. Had this been a bull market, the historical expectation would have been closer to +55%.
Related lessons
Related concepts
- Chart Patternlinked concept
- Breakoutlinked concept
- Reversal Patternslinked concept
- Momentumlinked concept
- Lead-In Phaselinked concept