Inside Bar
An inside bar is a session whose high is lower than the prior high and whose low is higher than the prior low, with the entire range contained within the previous bar. It represents a pause and a contraction of the trading range, and the prior bar's boundaries become natural reference levels.
- Bias
- Neutral / directionless
- Category
- Volatility Compression
- Scan cadence
- Every close
What has to be true for a Inside Bar to trigger
- The session high below the previous session's high
- The session low above the previous session's low
How PatternGrade grades it
A narrower inside bar relative to its mother bar, and better surrounding structure, raise the grade.
Every scanner grades its hits A+, A or B from the pattern's own measurable structure. The grading is deterministic — the same chart always produces the same grade. It describes how closely the chart matches the pattern, not how likely anything is to happen; no hit rate or probability is attached to a grade. The reasoning is set out in the methodology.
What a Inside Bar looks like in practice
A stock trades between $88.20 and $91.40 on Monday. On Tuesday it opens at $89.60 and spends the whole session between $89.10 and $90.80, so its entire range fits inside Monday's. Volume falls by about a third. Nothing new was established: no new high, no new low, just a pause entirely contained within the prior session's boundaries.
How a Inside Bar fails
Inside bars fail by being meaningless, which they usually are. They occur constantly, especially after high-volatility sessions where a quiet follow-up is the statistical norm rather than a signal. Trading them in isolation produces a stream of small whipsaws, since a break of a one-day range is a very low bar for ordinary noise to clear.
What this pattern is telling you
Inside bars are common. They occur constantly and mean little in isolation. Their value comes from context: an inside bar at a key level is a different thing from one in the middle of a range.
PatternGrade is not a financial advisor and does not give buy or sell recommendations. Targets and stops shown on a pattern are reference levels derived from its geometry, not advice.
How to scan for Inside Bar setups
PatternGrade rescans every liquid US stock (~4,500 names) for this pattern after every close and returns the hits as a graded list, with the pattern drawn on each chart, so you review setups rather than hunt for them.
Join the waitlist to be invited when sign-ups reopen and see the current Inside Bar list, or browse all 75 patterns.
Inside Bar FAQ
What is an inside bar?
A price bar whose entire high-to-low range falls within the previous bar's range, signalling a pause and a contraction in volatility.
What does an inside bar mean?
That the session established nothing new: no new high, no new low. It is a pause in which neither side pressed. After a large directional day it usually just means the market took a breath; inside a tight consolidation near a decision point it carries more weight.
Are inside bars a reliable signal?
On their own, no. They are extremely common and direction-neutral, and a one-day range is easily broken by noise. Their usefulness comes almost entirely from context, meaning where the bar sits in a larger structure, which is why PatternGrade grades placement rather than the bar in isolation.
What is a mother bar?
The larger preceding bar that contains the inside bar. Its high and low become the reference levels, and a break of either is the conventional trigger. Multiple consecutive inside bars inside one mother bar are read as tighter compression.
How does PatternGrade grade an inside bar?
By context and quality: how tight the containment is relative to the mother bar, whether volume contracted, and whether the bar sits somewhere meaningful, near the top of a base or at a tested level, rather than in the middle of nowhere. A well-placed inside bar can grade well; most grade B.
Patterns a Inside Bar is mistaken for
- NR7 (Narrow Range)
- NR7 requires the narrowest range of seven sessions. An inside bar only requires containment within the prior bar. An inside bar after a wide day can still be a fairly large range.
- Pennant
- A pennant is a multi-session converging consolidation after a sharp move. An inside bar is one session. Pennants often contain inside bars.
- Darvas Box
- Same containment idea at a completely different scale: a box is weeks of price held between two levels, an inside bar is one day inside another.
Last reviewed . Structure and grading for the Inside Bar are reviewed against the scanner's own rules.