Chart Patterns
Chart Patterns & Technical Analysis
Chart
Patterns are graphical representations of historical stock prices which help to
determine current supply and demand forces in a stock. Chart pattern
analysis allows a trader to determine with more accuracy just what the current
supply and demand is in a stock. Chart patterns are graphical
representations of historical stock prices which form repeating patterns or
shapes, and are commonly used in the stock market.
Trading
with technical analysis requires correctly identifying chart patterns. Technical
analysis is the study of price history to determine future trading
opportunities. Price history in the form of a price chart is the visual
representation of where prices have been, where buyers and sellers lurk, and
often times the trading psychology at work in the market. If human emotion
drives buying and selling behavior, then chart patterns can help to determine
where such emotions may next surface. Chart patterns are the depiction of
trading psychology in motion.
This
page is a starting point for those who are looking to improve their chart
pattern recognition and learn more about chart
patterns. Short term traders often study chart patterns to gauge supply
and demand forces in the stock market. Such forces are the basis for price
fluctuations, which enables a trader to profit.
Chart
patterns are useful gauges of momentum, support and resistance, and other
indications of strength or weakness in a stock. Chart patterns help
traders to determine market direction as well as time entries and exits. A
trader must be able to identify chart patterns properly. Only then
can a trader benefit from chart patterns.
This
page is a starting point for those who are looking to improve their chart
pattern recognition and learn more about chart
patterns. Short term traders often study chart patterns to gauge supply
and demand forces in the stock market. Such forces are the basis for price
fluctuations, which enables a trader to profit.
Chart
patterns are useful gauges of momentum, support and resistance, and other
indications of strength or weakness in a stock. Chart patterns help
traders to determine market direction as well as time entries and exits. A
trader must be able to identify chart patterns properly. Only then
can a trader benefit from chart patterns.
Be sure to read
understanding chart patterns as well as
finding chart patterns once you learn to identify them!
Chart Patterns - Continuation Patterns
Continuation patterns are chart patterns which set up the
stock for a follow through move in the direction of the prior trend.
Continuation chart patterns include all of the patterns listed below.
Cup and Handle
Flag Patterns
Pennant Patterns
Triangle Patterns
Channeling Stock
Rectangle
Chart Patterns - Reversal Patterns
Reversal patterns are chart patterns which reverse the trend
of a stock once the pattern is confirmed. Reversal patterns include all of the patterns listed below.
Double Top
Double Bottom
Head and Shoulders Top
Head and Shoulders Bottom
Wedge Patterns
Rounded Bottom
Triple Top
Triple Bottom
Stock Trading Terms
Day trading and swing trading terms are used when describing
chart patterns and market conditions. Click the links below to learn more
about each trading term.
Capitulation
Consolidation
IPO
Measured Move
Overbought
Oversold
Short Selling - Selling Short
Support and Resistance
Stock Gaps
Trend Lines
Parabolic Uptrend
Volume
Volatility
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