A forex chart graphically depicts the historical behavior, across varying time frames, of the relative price movement between currency pairs. Technical analysts and day traders will look at such charts in order to identify trends and various patterns that can signal reversals, continuations, entry points, and exits.
Cup and handle pattern is a bullish continuation pattern and momentum buy signal as it breaks out of the ‘handle’ in the formation. It was originally intended to be used with high growth stocks within the ‘CAN SLIM’ system. I cup and handle chart pattern ideally takes place early in bull markets when the stock indexes … Read more
Bullish Pennant Pattern Overview The bullish pennant chart pattern is a powerful bullish indicator often found during strong bull markets. While it bears similarities to the bull flag pattern, it is rarer and can lead to explosive price moves once a breakout occurs. These patterns frequently emerge in leading growth stocks that have experienced parabolic … Read more
Understanding the Bull Flag Pattern The bull flag pattern is a powerful continuation formation that traders often rely on to identify potential upward price movements. This pattern typically appears after a strong uptrend, signaling that the bullish momentum is likely to continue. Key Characteristics of the Bull Flag Continuation Pattern: The bull flag serves as … Read more
The diamond pattern is a price action formation that is created on a chart by buyers and sellers. It is a lesser-known chart pattern to technical traders than many of the more popular patterns. This formation is a less frequent and more uncommon reversal pattern on a chart than pennants and flags. It can happen … Read more
Understanding the Triple Bottom Pattern In technical analysis, the triple bottom pattern can signal a potential reversal in price direction, suggesting a shift from a downtrend to an uptrend. This pattern is characterized by price action finding support at a specific price zone three separate times, creating a strong indication that there are no sellers … Read more
Overview of the Inverted Hammer Pattern The inverted hammer pattern is a type of candlestick located at the end of a downtrend and is used by technical analysts as a bullish reversal signal from the lows. The inverted hammer candle visually looks like a hammer turned upside down with its handle pointing up. It is … Read more
Chart Facts: The Double Bottom Chart pattern is a reversal pattern that is bullish. This pattern is created when a key price support level on a chart is tested twice with a rally between the two support level tests. A double bottom chart pattern happens at the end of a downtrend that has likely gone on … Read more
How many types of chart patterns are there? There are three main types of chart patterns which are used in technical analysis: traditional chart patterns, harmonic patterns, and candlestick patterns. Traditional Chart Patterns Traditional chart patterns identify the behavior of traders and investors on a chart based on support and resistance trend lines. The purpose of … Read more
A wedge pattern generally forms and moves in the opposite direction of the longer-term trend on a chart and shows a short-term reversal that usually fails and the previous trend resumes.