Signal: Sellers are gaining control. A break below support confirms a downtrend.
📌 Entry:Enter at breakdown below support
🎯 Take Profit: Measure height and project downward
Example:
- Support: 50
- Resistance:60
- Height = 10
- Take Profit =50 - 10 = 40
3. 📈 Flag Pattern (Bullish Continuation)
What it looks like:A strong upward move (flagpole), followed by a downward-sloping rectangle (flag).
Signal:Quick consolidation before another strong push.
📌 Entry: Break above flag resistance
🎯 Take Profit: Length of flagpole added above breakout
Example:
- Flagpole = 20 move
- Breakout at120
- Take Profit = 120 +20 = 140
4. 📉 Bear Flag Pattern (Bearish Continuation)
What it looks like:Sharp downward move followed by a rising channel.
Signal:Temporary pullback before further drop.
📌 Entry:Break below flag support
🎯 Take Profit: Measure flagpole and subtract from breakdown
Example:
- Flagpole =15
- Breakdown at 70
- Take Profit =70 - 15 = 55
5. 🔁 Head and Shoulders (Bearish Reversal)
What it looks like:Three peaks — the middle one (head) is highest.
Signal: Trend reversal from bullish to bearish.
📌 Entry: Break below neckline
🎯 Take Profit: Measure height from head to neckline, subtract it
Example:
- Head: 120
- Neckline:100
- Height = 20
- Take Profit =100 - 20 = 80
6. 🔂 Inverse Head and Shoulders (Bullish Reversal)
What it looks like:Opposite of head and shoulders.
Signal:Bearish to bullish reversal
📌 Entry:Break above neckline
🎯 Take Profit:Height from head to neckline added above
Example:
- Head: 80
- Neckline:100
- Height = 20
- Take Profit =100 + 20 = 120
7. 📉 Double Top (Bearish Reversal)
What it looks like:Two peaks at the same level.
Signal: Market failed twice to break higher. Expect reversal down.
📌 Entry: Break below neckline
🎯 Take Profit:Distance from tops to neckline projected downward
Example:
- Tops: 90
- Neckline:80
- Height = 10
- Take Profit =80 - 10 = 70
8. 📈 Double Bottom (Bullish Reversal)
What it looks like: Two lows at the same level.
Signal: Strong support. Expect reversal up.
📌 Entry:Break above neckline
🎯 Take Profit: Height added above neckline
Example:
- Bottoms: 60
- Neckline:70
- Height = 10
- Take Profit =70 + 10 = 80
9. 🔄 Wedge Patterns (Reversal or Continuation)
Rising Wedge: Bearish
Falling Wedge: Bullish
📌 Entry:Breakout of the wedge
🎯 Take Profit: Measure the widest part of the wedge
Example (Falling Wedge):
- Top = 90, Bottom =80
- Width = 10
- Breakout =85
- Take Profit = 85 +10 = 95
10. ⭕ Rounding Bottom (Bullish Reversal)
What it looks like: Cup-shaped formation
Signal:Slow shift from bearish to bullish
📌 Entry:Breakout above resistance
🎯 Take Profit:Height of the cup added above breakout
Example:
- Bottom =70
- Resistance = 90
- Height =20
- Take Profit = 90 +20 = $110
✅ Tips for Using Patterns:
- 📌 Always wait for confirmation (breakout with volume)
- 📉 Use stop-loss below/above the pattern
- 🎯 Set take profit based on the pattern's measured move
- ⚠️ Combine with support/resistance, indicators, and price action
🧠 Final Thoughts
Chart patterns are powerful tools for predicting market moves 📊, but they’re not perfect. Use them with other confirmations, manage your risk, and never trade blindly. 🙅♂️ Patterns give you a plan: where to enter, where to exit, and where to protect your account. 🛡️
Start small, master one pattern at a time, and keep practicing. 📚✍️
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