A sharp spike reversal that runs almost vertically up (or down) and turns at once, with no rounding top, base, or distribution phase. The crowd's conviction flips in an instant, producing a reversal that is fast and steep.
A V top or V bottom is a sharp spike reversal that runs almost vertically up (or down) with no warm-up and turns at once, right at the peak (or trough).
Most reversal patterns take time at the extreme: they round over, or retest the same level again and again, so that buyers and sellers slowly swap the lead. A V reversal has almost none of that handover time. Price runs in a straight line and suddenly changes direction at a single point.
At a top it traces an inverted V (a sharp rise, then a sharp fall); at a bottom it traces a V (a sharp drop, then a sharp bounce). It is also called a spike reversal.
It happens when a sudden piece of news or an abrupt shift in sentiment flips the crowd's conviction in an instant. With little warning beforehand it is hard to anticipate, but once it turns, the move is fast and steep. False signals are common, so you wait to confirm the reversal rather than chase it.
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