What is an Ascending Scallop Pattern?
An ascending scallop is a bullish continuation pattern that forms when price pulls back in a rounded curve during an uptrend, then breaks above the prior swing high. The shape resembles a bowl that tips into a J.
What Does an Ascending Scallop Pattern Indicate?
Buyers remain in control after a brief pause. The rounded pullback shows sellers losing momentum while buyers absorb supply at the lows. When price reclaims the prior high, overhead supply has cleared and the trend resumes.
Is the Ascending Scallop Pattern Bullish or Bearish?
Bullish. The pattern forms inside an uptrend and resolves with a breakout above the prior swing high. Traders use it as a long continuation setup.
How to Identify an Ascending Scallop Pattern?
An ascending scallop has three required elements: an uptrend, a rounded U-shaped pullback that holds above the prior major swing low, and a breakout that takes out the prior swing high. Without all three, the setup is invalid.
Clear uptrend leading in — higher highs and higher lows
Rounded, U-shaped pullback
Defined resistance at the prior swing high
A higher low prints before the breakout attempt
Price closes above the prior swing high
How to Draw an Ascending Scallop Pattern?
Anchor the structure to two levels: the prior swing high (your resistance) and the bottom of the rounded pullback. Then mark the higher low that prints right before the breakout attempt.
Draw a horizontal line at the prior swing high. That's the level price must reclaim.
Mark the pullback low — the bottom of the bowl.
Mark the higher low that forms as price turns back up.
Trace the rounded pullback into the resistance level.
How to Trade an Ascending Scallop Pattern?
Two clean entries work for this pattern: a long on a confirmed breakout above the prior swing high, or a long on the first retest of that level after the breakout holds. The setup works when the old high flips to support and price prints higher highs again.
Breakout entry: Buy a daily close above resistance — the prior swing high.
Retest entry: Buy the first pullback that holds above the breakout level after price clears it.
Confirmation: A strong close above the level with clean momentum.
What is the Profit Target for an Ascending Scallop Pattern?
The profit target is a measured move. Take the height from the pullback low to the resistance level, then project that distance upward from the breakout point.
Formula: Target = Breakout level + (Resistance − Pullback low)
Example: Resistance sits at $100, pullback low at $92, breakout fires at $100. Target = $100 + ($100 − $92) = $108.
Where to Put a Stop Loss on an Ascending Scallop Pattern?
Place the stop below the most recent higher low — the one that prints right before the breakout attempt. A break below this level invalidates the continuation thesis and signals that the pullback is expanding.
Standard stop: A few ticks (or cents) below the higher low that precedes the breakout.
Wider stop: Below the pullback low itself — use this when the instrument is volatile and the structure is wide.
What Happens After an Ascending Scallop Pattern?
After the breakout, one of three things happens: price trends higher immediately, pulls back to retest the breakout level before continuing, or fails outright. The most common failure mode is a breakout that stalls, drops back under resistance, then breaks the higher low, trapping late buyers who chased the move.
Follow-through: Price holds above the breakout level and accelerates into a new impulse leg.
Throwback: Price revisits the breakout level, holds it as support, then resumes higher. Normal behavior.
Failure: Price closes back below resistance, then loses the prior higher low.