There are so many chart patterns which will help you to know that at what direction the market is going or what next move can market make, here are some of important chart patterns that very trader should know about.
1. Head And Shoulder
Head and shoulder pattern is a pattern where a chart makes three peaks and takes a support all the three peaks takes support at same level and in which 1 & 3 peak are smaller than the 2nd peak.
you can use head and shoulder pattern to predict the bullish to bearish reversal. The support where the price is taking a support while making tops that range is called as neckline when the neckline is broken by the second shoulder the we can say the bearish trend has been started and you can take trade on bearish side.
2. Double Top
As we can guess what the patter is going to be like from its name the double top, In the double top pattern the price creates two peaks and double top pattern is also can be use to predict the reversal trend the price will make as peak and again came to the neakline for the support and make one more peak and after that when it broke that neakline the bearish trend starts.
3.Double Bottom
Double Bottom pattern is know to start a bullish trend in the market the price will drop below the level of support and came to the level resistance before dropping again after that the trend will revers and and the price will start moving upwards and starts the bullish momentum.
A Double Bottom pattern is the bullish reversal pattern, It shows the end of the down trend and shows the start of up trend.
4.Rounding Bottom
A round bottom can be used to predict a reversal trend when as a bullish reversal pattern shown below the round bottom has been formed which changed the momentum of the price from down trend to up trend that's how we can use the round bottom patter to predict the reversal in the market.
5 Cup And Handle
The cup & handle pattern is same as a round bottom pattern but also has wedges pattern in it in this pattern the cup with handle like structure has been formed and when the wedges pattern pattern which we are taking as a handle of this pattern breakouts the bullish trend has been conformed so many traders use the cup and handle patter as a conformation of bullish trend .
6. Wedges
Wedges form as an price movements tighten between two sloping trend lines. There are two types of wedge: rising and falling.
Rising Wedges : In the rising wedges pattern price keep moving in upward direction between a trend line and resistance line and when the support line has been broken the down trend has been conformed.
Falling wedges: It is exact opposite of rising wedges in this pattern the price is in the down trend in a specific range of support trend line and resistance line & when that is broken the bullish trend starts.
7 Flag
In the flag pattern the price consolidate in a triangular pattern or we can say make a pattern looking like a flag and breakout in bearish or bullish side and the price goes on the side where the pattern has been broke out
Like below where the price has given breakout at up side and the market has gone at bullish side.
8 Ascending Triangle
In the ascending triangle pattern the price get resistance from up side and the price keeps making higher lows and once the price broke out the triangle you can predict the direction market at that time.
9 Descending Triangle
In descending triangle the price gets support from below and keeps making lower highs and once the support has been broken the price shows its direction.
10 Symmetrical triangle
Symmetrical triangle is same as the flag pattern in this pattern the price keeps making both the higher lows and lowers highs and the price keeps consolidating and make triangular patter & when the price broke out from that triangle then we can know the direction of the market and can take trade according to that.
So these are the top 10 chart patters that you should know before you start trading with real money if you liked it please share this and follow me on Instagram and if you have any doubt you can ask me in the comment or you can also DM on Instagram.
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