Island reversal

[citation needed] Close scrutiny of island reversal formations shows that the island reversal consists of an exhaustion gap and the subsequent move is followed by a breakaway gap.

Uncommonly, the breakaway gap that completes the island is filled in a few days by a pull back as a result of the reaction.

On the following day, the market price opened at $87.40, touched a high of $88.90, and closed at $87.00.

All the trading above $86.00 will appear on the technical analysis chart to be isolated and is known as an "island reversal."

An example of a bearish island reversal pattern was identified by Kenneth Gruneisen and published via CANSLIM.net when ITT Educational Services (ESI) topped in January 2009.