Author,
@MrJangKen ID: 766881381
Now that youāve got candlestick patterns and volume down, itās time to unlock the power of chart patterns ā shapes that can predict market moves before they happen! Ready to read the market like a pro? Letās go!
š What Are Chart Patterns?
Chart patterns are visual shapes formed by price movement. They help traders predict:
š¹Whether price will break up or down
š¹When trends are likely to continue or reverse
Think of them like road signs on the price journey!
šŗ Continuation Patterns (Price Likely to Keep Moving in Same Direction)
1. Symmetrical Triangle šŗ
š¹Price squeezes into a tight range
š¹Breakout can go up or down (watch volume!)
š¹Signal: Big move coming!
2. Bull Flag š©
š¹Sharp rise ā small pullback ā breakout upward
š¹Like a flag on a pole ā shows bullish continuation
3. Bear Flag š“
š¹Sharp drop ā small upward pullback ā breakdown
š¹Same as bull flag but in reverse
š Reversal Patterns (Price Likely to Change Direction)
1. Head & Shoulders
š¹Three peaks: tall middle (head), smaller sides (shoulders)
š¹Signal: Trend reversal from up to down š»
2. Inverse Head & Shoulders
š¹Flipped version of above
š¹Signal: Reversal from down to up š
3. Double Top ā°ļøā°ļø
š¹Two peaks at the same level
š¹Signal: Bearish reversal
4. Double Bottom ā³ā³
š¹Two dips at same price
š¹Signal: Bullish reversal
š§© How to Use Chart Patterns Effectively
š¹Combine with volume (Part 3): Breakouts with high volume = stronger signals
š¹Confirm with candlestick patterns (Part 2)
š¹Watch for support/resistance at breakout zones (Part 1)
ā
Pro Tips
š¹Donāt rush ā patterns take time to form
š¹Set alerts at breakout points
š¹Use patterns with risk management ā always set stop-loss!
š Final Thoughts
Chart patterns are like treasure maps for traders. When used with volume and candlesticks, they become powerful tools to catch early moves and avoid traps.
Up next in Part 5: Weāll dive into Risk Management & Trade Psychology ā the ultimate tools to protect your capital!
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