A chart pattern or price pattern is a pattern within a chart when prices are graphed. In stock and commodity markets trading, chart pattern studies play a large role during technical analysis. When data is plotted there is usually a pattern which naturally occurs and repeats over a period.
A Candlestick Patterns is a type of chart used in trading as a visual representation of past and current price action in specified timeframes. A candlestick consists of the body with an upper or lower wick or shadow. Candlesticks are created using the opening and closing prices along with the trading range of the candlestick period. How do you … Read more
In technical analysis the triple top chart pattern can be a possible signal for a reversal lower in price.
Descending triangle chart patterns The opposing of the ascending triangle is the descending triangle. The upper side of the falling triangle slopes downward as the price makes lower highs, with the bottom of the triangle typically being a flat level of support. This pattern may indicate that support is eroding and that a downward breakout … Read more
The inverted cup with handle is a reversal pattern and momentum sell short signal as it breaks down out of the ‘handle’ in the formation. It is usually a topping pattern after a strong move to the upside signaling the end of an uptrend on a chart. An inverted cup and handle chart pattern ideally … Read more
Chart Facts: Bear Pennant Example Here is an example of a bear pennant that formed on the Bitcoin chart during a downtrend in price. After the clear downtrend in the first half of January a bear pennant formed in the second half of January before the downtrend continued in the first week of February. Price … Read more
Bear Flag Pattern Explained; Two drops separated by a brief period of consolidating retracement constitute a bear flag, a bearish chart pattern. The flagpole develops after an almost vertical panic price collapse when bulls are caught off guard by sellers, followed by a bounce with parallel upper and lower trendlines that creates the flag. The … Read more
The Head and Shoulders Chart Pattern is one of the most popular and bearish patterns in technical analysis. It defines three attempts to make highs and then trend but fail, it precedes many major corrections and bear markets. Chart Facts: The below $GS chart shows a Head and Shoulders pattern that was very fast to … Read more
Chart patterns are specific price formations on a chart that predict future price movements. As technical analysis is based on the assumption that history repeats itself, popular chart patterns have shown that a specific price movement is following a particular formation of price (chart pattern) with high probability. Therefore, chart patterns are grouped into (1) continuation patterns – that signal a continuation in the underlying trend, and (2) reversal patterns – that signal reversal of the underlying trend.
Rounding top pattern typically appears at the end of extended upward trends and may signify a significant reversal in long-term price movements. Traders often observe this formation after a prolonged period of rising prices, which leads to increased bullish sentiment. However, as the pattern develops, it indicates that this bullish momentum is waning. The pattern … Read more
The Double Top Chart pattern is a reversal pattern that is bearish. This pattern is created when a key price resistance level on a chart is tested twice with a pullback between the two high prices at resistance price level tests. Chart Facts: A double top chart pattern happens at the end of an uptrend that … Read more