Point and Figure Charts: Price Targets

Point and Figure (P&F) is the oldest charting method still in active use — and the only one that ignores time entirely. Every column tells you what price did, not when.

Where candlesticks record every minute of market action, P&F records only movement that matters. A column of Xs marks rising prices; a column of Os marks falling prices. The chart flips columns only on a reversal large enough to matter.

The two settings

Every P&F chart depends on two parameters:

• Box size — the minimum price move recorded. Set with ATR, a fixed point amount, or a percentage.
• Reversal amount — how many boxes price must move against the column before a flip. The classic is the 3-box reversal.

A common starting setup: box size = 1% of price, 3-box reversal. You then ignore moves smaller than 3%.

Reading the chart

• X column up = uptrend, buyers in control.
• O column down = downtrend, sellers in control.
• Double top = X column exceeds the previous X column — bullish signal.
• Double bottom = O column breaks the previous O column low — bearish signal.
• Triple top/bottom = stronger, less common breakouts.

Because P&F ignores time, signals can take a day or a month to print.

Projecting price targets

1. Horizontal count (breakout target)

When price breaks a resistance level, count the boxes across the widest part of the consolidation. Multiply by box size × reversal amount, then add to the breakout price.

Example: 10 boxes wide, box size $1, 3-box reversal.

Target extension = 10 × $1 × 3 = $30 above breakout

2. Vertical count (reversal target)

When a new trend column begins after a reversal, count the boxes in that first column. Multiply by box size × reversal factor, then project from the column's top or bottom. Vertical counts are aggressive — use them as best-case targets, not primary exits.

Why targets work on P&F

Because P&F is built from price movement alone, the geometry is consistent across markets and decades. A horizontal count on a 1970 stock chart is calculated the same as one on a 2026 Bitcoin chart.

P&F strategy checklist

1. Confirm the dominant column direction (more Xs above Os = uptrend).
2. Wait for a double or triple top breakout (longs).
3. Project a horizontal count target.
4. Stop loss: 1 box below the breakout column.
5. Exit: scale out at 50% and 75% of the target; trail the rest.

Limitations

• No time data: combine with candlesticks for context.
• Gaps: large overnight gaps distort box counts.
• Subjective box size: too small = noise; too large = no signals.

Point and Figure rewards traders who prefer clean structure over speed. Use it for measured targets and breakout confirmation, not for timing entries to the minute.