Chart pattern: Difference between revisions

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{{Short description|Pattern within a chart when prices are graphed}}

{{More citations needed|date=July 2015}}

[[File:Triangle-ascending.jpg|thumb|Ascending triangle pattern]]

A '''chart pattern''' or '''price pattern''' is a [[pattern]] within a [[chart]] when prices are graphed. In stock and [[commodity market]]s trading, chart pattern studies play a large role during [[technical analysis]]. When [[data]] is plotted there is usually a pattern which naturally occurs and repeats over a period. Chart patterns are used as either reversal or continuation signals.

== Traditional Chartchart Patternpattern ==

There are four main types of chart patterns which are used by technical analysts:

Included in this type are the most common patterns <ref>{{Cite web|url=https://stockcharts.com/school/doku.php?id=chart_school:chart_analysis:chart_patterns|title=Chart Patterns|website=StockCharts.com |access-date=2019-05-23}}</ref> which have been introduced to chartists for more than a hundred years. Below is a list of the most commonly used traditional chart patterns:

* [https://www.investopedia.com/university/charts/ traditional chart pattern]

* [https://harmonictraderx.com/harmonic-patterns/ Harmonic Patterns]

* [[candlestick pattern]]

* [https://www.xabcdtrading.com/ XABCD Patterns]

== Traditional Chart Pattern ==

Included in this type are the most common patterns <ref>{{Cite web|url=https://stockcharts.com/school/doku.php?id=chart_school:chart_analysis:chart_patterns|title=Chart Patterns|website=StockCharts.com |access-date=2019-05-23}}</ref> which have been introduced to chartists for more than a hundred years. Below is a list of the most commonly used traditional chart patterns:

Reversal Patterns:

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# Key Reversal Bar<ref>{{Cite web|url=https://financestrategysystem.com/key-reversal-pattern/|title=Key Reversal Bar|website=FinanceStrategySystem|language=en-US|access-date=2018-04-10}}</ref>

Continuation Patternspatterns:

# Triangle

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# Cup with Handle

== Harmonic Patternpattern ==

Harmonic Pattern<ref>[http://www.informit.com/store/harmonic-trading-volume-one-profiting-from-the-natural-9780137051502 Harmonic Trading, Volume One: Profiting from the Natural Order of the Financial Markets By Scott M. Carney Published Apr 12, 2010 by FT Press.]</ref> utilizes the recognition of specific structures that possess distinct and consecutive Fibonacci ratio alignments that quantify and validate harmonic patterns. These patterns calculate the Fibonacci aspects of these price structures to identify highly probable reversal points in the financial markets. This methodology assumes that harmonic patterns or cycles, like many patterns and cycles in life, continually repeat. The key is to identify these patterns and to enter or to exit a position based upon a high degree of probability that the same historic price action will occur.

Line 44 ⟶ 39:

Traders use the Potential Reversal Zone (PRZ) as an important level of support/resistance in their trading and price action strategy.

== XABCDCandlestick Patternspattern ==

In [[technical analysis]], a '''[[candlestick pattern''']] is a movement in prices shown graphically on a [[candlestick chart]] that some believe can predict a particular market movement. The recognition of the pattern is subjective and programs that are used for charting have to rely on predefined rules to match the pattern. There are 42 recognized patterns that can be split into simple and complex patterns.

XABCD Patterns<ref>[https://www.xabcdtrading.com/xabcd-patterns-complete-guide/ The Complete Guide to XABCD Patterns by XABCD Trading Published Sep 6, 2017]</ref> are the latest categories of '''candlestick pattern''' in which a pattern is measured using both Fibonacci time and Fibonacci price. XABCD Patterns are created by measuring both up and down and left to right. This leads to a much more consistently shaped pattern. The XABCD type of pattern is broken down into two main classifications:

# ETP (Extension Time Patterns)

# RTP (Retracement Time Patterns)

# XTP (X-Point Time Patterns)

Steve Nison is the person who introduced candlesticks to the West.<ref>{{Cite web|url=https://www.marketwatch.com/story/the-candlesticks-man-says-hes-not-buying-stocks-2015-12-01|title=The 'candlesticks man' says he's not buying stocks|last=Kilgore|first=Tomi|website=MarketWatch|language=en-US|access-date=2018-12-31}}</ref> There are hundreds of candlestick pattern available which are discussed in Steve's book [https://books.google.com/books?id=rbn8NeXOYV4C Japanese Candlestick Charting Techniques].

These XABCD patterns can both be traded as a counter-trend trade or a trend continuation trade. Each pattern has a specific area defined as its reversal and targets.

Below is a list of commonly used candlestick patterns:

== Candlestick Pattern ==

In [[technical analysis]], a '''candlestick pattern''' is a movement in prices shown graphically on a [[candlestick chart]] that some believe can predict a particular market movement. The recognition of the pattern is subjective and programs that are used for charting have to rely on predefined rules to match the pattern. There are 42 recognized patterns that can be split into simple and complex patterns.

# Engulfing

Steve Nison is the person who introduced candlesticks to the West.<ref>{{Cite web|url=https://www.marketwatch.com/story/the-candlesticks-man-says-hes-not-buying-stocks-2015-12-01|title=The 'candlesticks man' says he's not buying stocks|last=Kilgore|first=Tomi|website=MarketWatch|language=en-US|access-date=2018-12-31}}</ref> There are hundreds of candlestick pattern available which are discussed in Steve's book [https://books.google.com/books?id=rbn8NeXOYV4C Japanese Candlestick Charting Techniques].

# Inside bar<ref>{{Cite web |last=Muhammad |first=Ali |date=2021-08-22 |title=Understanding Inside Bar Pattern in Detail for Forex Trading |url=https://forexbee.co/inside-bar-pattern/ |access-date=2024-01-28 |website=ForexBee |language=en-US}}</ref>

# Doji

# Pin bar

# Morning doji star

# Evening doji star

# Tweezer top

# Tweezer bottom

==See also==

* [[Candlestick chart]]

* [https://finohindi.com/stock-market-chart/ Stock market Chart]

* [https://finohindi.com/candlestick-pattern/ Candlestick Pattern]

* [https://finohindi.com/candlestick-chart-pattern/ Candlestick Chart Pattern]

* [[Elliot wave]]

* [[List of information graphics software]]

* [https://www.xabcdtrading.com/ XABCD Patterns]

* [[Market trends]]

* [[Price action trading]]