Chart Pattern Terms

An ascending triangle is a bullish continuation pattern with horizontal resistance and rising support. It shows buyers gaining strength, typically breaking upward.

Chart patterns are recognizable formations in price action that suggest future price movements. They include reversal patterns (head and shoulders) and continuation patterns (triangles).

A cup and handle is a bullish continuation pattern featuring a rounded base followed by a shallow pullback before breakout.

A descending triangle is a bearish continuation pattern with horizontal support and declining resistance. It shows sellers gaining control, typically breaking downward.

A double bottom is a bullish reversal pattern with two troughs at similar levels, showing buyers are defending support. Confirmed when price breaks resistance between the bottoms.

A double top is a bearish reversal pattern with two peaks at similar levels, indicating sellers are defending resistance. Confirmed when price breaks the support between peaks.

A flag is a counter-trend consolidation that follows a sharp move and typically breaks in the direction of the original trend.

Head and shoulders is a reversal chart pattern with three peaks - a higher peak (head) between two lower peaks (shoulders). It signals trend reversal when the neckline breaks.

Island reversal is a rare chart pattern where price gaps in one direction, consolidates briefly, then gaps in the opposite direction, leaving an isolated price island signaling strong trend reversal.

A pennant is a continuation pattern where price consolidates into a small triangle after a sharp flagpole move. Breakouts typically continue the prior trend, with targets based on the flagpole height.

A rounding bottom is a long-duration reversal pattern where price forms a smooth U-shape, signaling accumulation before an upside breakout.

A symmetrical triangle is a chart pattern with converging trendlines representing market indecision and consolidation, typically breaking out in the direction of the prior trend.

A wedge is a converging pattern where both trendlines slope in the same direction, usually preceding a breakout opposite the slope.