Chart patterns are visual frameworks traders use to interpret crowd behavior. They highlight shifts in supply and demand, continuation of trends, or potential reversals. While patterns can guide trade planning, they are not predictive guarantees. Always combine them with sound risk management, confirmation signals, and a defined strategy.
This article shows the most common continuation, reversal, and candlestick patterns as simple diagrams for quick reference. Use them to sharpen your technical analysis and improve your decision-making process.
Flag
A sharp price move followed by a small, sloping channel. Breakouts usually continue in the direction of the initial move.Pennant
A brief consolidation shaped like a small triangle. Typically resolves with continuation of the prior trend.Rectangle
Price trades sideways within parallel support and resistance levels. Breakouts can be bullish or bearish depending on context.Head and Shoulders
Three peaks with the middle (head) higher than the two shoulders. A break below the neckline signals a bearish reversal.Double Top
Two peaks at a similar level. A break of the neckline suggests trend reversal to the downside.Double Bottom
Two troughs at a similar level. A break above the neckline suggests bullish reversal.Triple Top
Three peaks at a similar level. Breakdown from the base confirms bearish reversal.Triple Bottom
Three troughs at a similar level. Breakout above resistance confirms bullish reversal.Ascending Triangle
Flat resistance with higher lows pressing upward. Typically breaks to the upside.Descending Triangle
Flat support with lower highs pressing downward. Typically breaks to the downside.Symmetrical Triangle
Converging trendlines form a tight apex. Breakout can occur in either direction.Broadening Formation
Expanding highs and lows that increase volatility. Often appears near market tops or unstable conditions.
Chart patterns provide a visual way to interpret market behavior and highlight potential turning points or continuations. They are best used as decision aids, not predictions. Always confirm with additional tools such as volume, momentum, or higher-timeframe analysis, and anchor every trade with clear risk management.
Use the numbered chart and descriptions above as a quick reference guide when analyzing price action. Over time, consistent practice will help you recognize these setups more quickly and apply them with discipline.
Educational material only. Not investment advice.