Chart patterns
Measured move
Definition
A target convention: take the height of the pattern, or the length of the flagpole, and project it from the breakout point. It is a reference for planning, not a forecast.
Example
Suppose a stock rallies from $40 to $48, an $8 flagpole, then drifts lower in a flag and breaks out at $46.50. The measured move adds $8 to the breakout point, giving a reference target of $54.50. A trader might plan partial exits near there, knowing price can stall well short of it or run far past it.
Hypothetical numbers, for illustration only.
Also defined in
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