Chart patterns are specific formations on the stock price charts. These formations represent recognizable patterns that are repeatedly seen in the market, and are used to determine the future movement of the stock prices. The patterns represent the psychology of the market and investors, and also determine the future behaviour of the market. In a […]
Chart Patterns
Reversal Chart Patterns: Head and Shoulders
In the Chart Patterns Overview, we discussed that reversal chart patterns signal the ending on an ongoing trend, i.e., they signify a reversal of asset’s price direction. Head and Shoulders is the most common reversal pattern. There can be a normal head and shoulders pattern or inverse head and shoulders pattern, depending on whether the […]
Reversal Chart Patterns: Double Tops and Bottoms
In the Chart Patterns Overview, we discussed that reversal chart patterns signal the ending on an ongoing trend, i.e., they signify a reversal of asset’s price direction. In this article, we will discuss the two popular reversal patterns, namely, Double Top and Double Bottom Double Tops: The Double Top pattern is formed when an uptrend […]
Reversal Chart Patterns: Rising and Falling Wedge
In the Chart Patterns Overview, we discussed that reversal chart patterns signal the ending on an ongoing trend, i.e., they signify a reversal of asset’s price direction. In this article, we will discuss the two popular reversal patterns, namely, Rising and Falling Wedge. The wedge pattern is a commonly found pattern in security prices. It […]
Continuation Chart Patterns: Rectangles
In the Chart Patterns Overview, we discussed that continuation chart patterns signal that the ongoing trend will continue for some time. This means that after the formation, the price movement will continue to follow the same trend as it was before the formation. Rectangles are common continuation pattern. They suggest that the prices will continue […]