Chart pattern: Difference between revisions

Revision as of 07:52, 30 October 2020

Latest revision as of 07:16, 28 August 2025

(44 intermediate revisions by 25 users not shown)

Line 1:

{{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 3 main types of chart pattern which are currently 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],

* harmonic pattern <ref>[https://harmonicpattern.com/knowledge harmonic pattern from the https://harmonicpattern.com]</ref>

* [[candlestick pattern]].

== 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:

Line 19 ⟶ 15:

# 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

Line 26 ⟶ 22:

# 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 34 ⟶ 30:

# Butterfly

# Gartley

# Cypher

# Crab

# Deep Crab

Line 44 ⟶ 39:

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

== Candlestick Patternpattern ==

Harmonic Patterns can be used along with other Technical Analysis tools for better confirmation.<ref>[https://www.amazon.in/Trading-Harmonic-Patterns-Technical-Analysis/dp/8193784596 Trading Harmonic Patterns With Technical Analysis By Rohan Shah]</ref>

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.

Steve Nison is the oneperson who introduced candlestick pattern from Japancandlesticks 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'candlesticks man’man' says he’she'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/about/Japanese_Candlestick_Charting_Techniques.html?id=rbn8NeXOYV4C&redir_esc=y Japanese Candlestick Charting Techniques].

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 one who introduced candlestick pattern from Japan 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/about/Japanese_Candlestick_Charting_Techniques.html?id=rbn8NeXOYV4C&redir_esc=y 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==

* [[Elliot wave]]

* [[List of information graphics software]]

* [[Market trends]]

* [[Price action trading]]

* [[Trend following]]

* [[Elliot wave]]

* [[Candlestick chart]]

* [[Price action trading]]

{{technical analysis}}

==References==

{{Reflist}}

{{technical analysis}}

{{DEFAULTSORT:Chart Pattern}}