How to Scan for Chart Patterns Across the Market
Step-by-step tutorial: use Diplyzer to scan for the highest-probability chart patterns across the S&P 500, filter for momentum confirmation, and identify the best technical setups right now.
Step-by-step tutorial: use Diplyzer to scan for the highest-probability chart patterns across the S&P 500, filter for momentum confirmation, and identify the best technical setups right now.
Finding a great chart pattern is only the beginning. The real edge comes from efficiently scanning a universe of hundreds of stocks, filtering for momentum confirmation, and arriving at a short list of the highest-conviction setups — all before the market opens.
This tutorial walks you through the exact workflow.
By the end of this tutorial, you will be able to:
Start by deciding what type of setup you are looking for. Different patterns work better in different market environments:
For this tutorial, we'll scan for Bull Flags across the S&P 500 on the daily timeframe.
"Scan S&P 500 stocks with positive free cash flow and market cap above $10B for Bull Flag patterns on the daily chart in the last 3 months. Rank results by similarity score from highest to lowest."
Diplyzer will return a list of matching stocks with their similarity confidence scores and the date range of the pattern.
A chart pattern alone is not enough. You want momentum confirming your directional thesis:
"From those Bull Flag results, which ones have: an RSI below 60 (not yet overbought), and a MACD histogram that turned positive in the last 5 trading days?"
This filter removes setups where momentum is already extended (RSI above 70) or where the MACD isn't confirming bullish pressure. You'll typically narrow the list from 20-30 results to 5-8 high-quality setups.
Even the best individual stock setup can fail in a hostile market environment:
"What is the current RSI and MACD reading on the SPY (S&P 500 ETF) on the daily chart? Is the broader market in an uptrend? What is the current VIX level?"
If the market is:
Pick the top 2-3 candidates from your filtered list and request a complete analysis:
"Give me the full technical analysis for [ticker]. Show the chart with the Bull Flag highlighted, the RSI, MACD, and Bollinger Bands. Where is the entry zone, the pattern price target, and the key support level for a stop loss?"
Look for:
Before entering any trade, verify there are no scheduled catalysts that could override the technical setup:
"When does [ticker] report earnings next? Are there any other upcoming events — dividend dates, analyst days, or expected regulatory decisions — in the next 30 days?"
If earnings are within 2-3 weeks: Either skip the trade or size very small — the technical target may not be reached before the binary earnings event.
If the calendar is clear: Green light to proceed with your technical setup.
The final check — volume:
"Show me the volume bars on [ticker]'s chart alongside the Bull Flag pattern. Was the flagpole formed on above-average volume? Is the flag consolidation occurring on declining volume (healthy)?"
Ideal Bull Flag characteristics:
Once you're comfortable with the workflow, compress it into a single comprehensive request:
"Scan S&P 500 Technology & Industrial stocks ($10B+ market cap) for Bull Flag patterns in the last 3 months, daily chart. Filter for: RSI below 60, MACD histogram positive. From the top matches, give me the full technical breakdown of the highest-scoring setup: chart with pattern highlighted, RSI, MACD, Bollinger Bands, entry/target/stop levels, and the next earnings date."
Scanning for reversal opportunities:
"Scan Nasdaq 100 Tech stocks ($10B+ market cap) for Inverse Head and Shoulders patterns that have completed but haven't broken out above the neckline yet. Which have RSI in the 40-55 range?"
Scanning for continuation plays in crypto:
"Scan the top 20 cryptocurrencies by market cap for Ascending Triangle patterns on the 4-hour chart. Which are approaching the triangle apex and showing bullish momentum?"
Scanning for value with technical timing:
"Find S&P 500 stocks with P/E ratios below their sector median AND showing a Cup and Handle or Double Bottom pattern on the daily chart."