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Chart Patterns (Updated)

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Jude Fernando
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16 views

Chart Patterns (Updated)

Uploaded by

Jude Fernando
Copyright
© © All Rights Reserved
Available Formats
Download as PDF, TXT or read online on Scribd
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ASCENDING CHANNEL

DESCENDING CHANNEL
SYMMETRICAL TRIANGLE
EXPANDING TRIANGLE

*
ASSENDING TRIANGLE
DESCENDING TRIANGLE
TR RISING WEDGE PATTERNS
FALLING WEDGE PATTERNS
HEAD AND SHOULDERS PATTERNS
What Is the Head and Shoulders Pattern?
A head and shoulders pattern is used in Technical
analysis. It is a specific chart formation that predicts a bullish-
to-bearish trend reversal. The pattern appears as a baseline
with three peaks, where the outside two are close in height, and
the middle is highest.

The head and shoulders pattern forms when a stock's price


rises to a peak and then declines back to the base of the prior
up-move. Then, the price rises above the previous peak to form
the "head" and then declines back to the original base. Finally,
the stock price peaks again at about the level of the first peak
of the formation before falling back down.

The head and shoulders pattern is considered one of the most


reliable trend reversal patterns. It is one of several top patterns
that signal, with varying degrees of accuracy, that an upward
trend is nearing its end.

• A head and shoulders pattern is a technical indicator with


a chart pattern of three peaks, where the outer two are
close in height, and the middle is the highest.
• A head and shoulders pattern—considered one of the
most reliable trend reversal patterns—is a chart formation
that predicts a bullish-to-bearish trend reversal.
• An inverse head and shoulders pattern predicts a bearish-
to-bullish trend.
• The neckline rests at the support or resistance lines,
depending on the pattern direction.
HEAD AND SHOULDERS PATTERNS
INVERSE HEAD AND SHOULDERS PATTERNS
DOUBLE TOP AND DOUBLE BOTTOM

What Is Double Top and Bottom?


Double top and bottom patterns are chart patterns
that occur when the underlying investment moves in a
similar pattern to the letter "W" (double bottom) or "M"
(double top). Double top and bottom analysis is used
in Technical analysis to explain movements in a
security or other investment, and can be used as part of
a trading strategy to exploit recurring patterns.
DOUBLE TOP PATTERN
DOUBLE BOTTOM PATTERN
TRIPLE TOP AND TRIPLE BOTTOM
Price patterns are seen in identifiable sequences of
price bars shown in Technical analysis charts. These
patterns can be used by to examine past price movements
and predict future ones for a particular trading instrument.
Readers should already be familiar
with Trendlines, continuation price patterns and Reversal
price patterns.

In this article, we will explore how to interpret the patterns


once they have been identified and examine the rare but
powerful Triple top and Triple bottom patterns.

• A triple top is formed by three peaks moving into the same


area, with pullbacks in between, while a triple bottom
consists of three troughs with rallies in the middle.
• While not often observed in everyday market trading, triple
tops and bottoms provide compelling signal to technical
traders for trend reversals.
• In addition to chart shapes portraying the letters "M" or
"W", trading volume trends should also be employed to
confirm the strength of the signal
TRIPLE TOP PATTERN
TRIPLE BOTTOM PATTERN
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