If you trade or invest, knowing chart patterns helps you guess where prices might go next!
There are 3 main types of patterns:
๐ Reversal Patterns โ Trend Might Flip!
These show that the price may go in the opposite direction than before.
1. Double Top โ Price hits the same high twice, then falls. ๐ป
2. Head & Shoulders โ Three peaks, middle one is the highest. If it drops below the "neck," trend reverses. โ ๏ธ
3. Rising Wedge โ Price goes up but in a tight range, then breaks downward. ๐
4. Double Bottom โ Price hits same low twice, then goes up. ๐ผ
5. Inverse Head & Shoulders โ Three dips, with the middle one deeper. If it breaks above neckline, itโs bullish. ๐ข
6. Falling Wedge โ Price goes down in a tight range, then breaks upward. ๐
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๐ Continuation Patterns โ Trend Keeps Going
These show the price is just resting, and the trend will likely continue.
1. Falling Wedge โ Price drops slowly, then jumps up. ๐
2. Bullish Rectangle โ Price moves sideways, then goes higher. โก๏ธ๐ผ
3. Bullish Pennant โ Small triangle after an uptrend, then continues rising. โซ
4. Rising Wedge โ Price climbs slowly, then falls. โฌ๏ธ
5. Bearish Rectangle โ Moves sideways, then drops. โก๏ธ๐ป
6. Bearish Pennant โ Small triangle after a downtrend, then falls more. โฌ
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๐ Bilateral Patterns โ Can Go Up or Down
These are uncertain. The breakout can happen either way, so wait for a clear signal!
1. Ascending Triangle โ Flat top, rising bottom. Can break up or down. ๐บ
2. Descending Triangle โ Flat bottom, falling top. Can break either way. ๐ป
3. Symmetrical Triangle โ Both sides squeeze together. Could break any direction. โ
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โ Quick Tips for You:
Reversal Patterns = Trend is about to change
Continuation Patterns = Trend will keep going
Bilateral Patterns = Could go any way โ wait for confirmation!
