Chart Pattern Handbook
Reversal Patterns
Head and Shoulders
A reversal pattern indicating a trend change from bullish to bearish. Characterized by three peaks:
the central peak (head) being higher than the two shoulders.
Double Top/Bottom
Double Top signals a bearish reversal after an uptrend, while Double Bottom signals a bullish
reversal after a downtrend.
Triple Top/Bottom
Triple Top signals a bearish reversal after an uptrend, while Triple Bottom signals a bullish reversal
after a downtrend.
Inverse Head and Shoulders
The opposite of Head and Shoulders, signaling a bullish reversal in a downtrend.
Continuation Patterns
Bullish/Bearish Flag
Flags are small rectangles indicating a pause in the trend before continuation. Bullish flags occur
after a strong uptrend, bearish flags after a strong downtrend.
Bullish/Bearish Pennant
Similar to flags but smaller, with converging trend lines. Bullish pennants occur after uptrends,
bearish pennants after downtrends.
Ascending/Descending Triangle
Ascending triangles suggest bullish continuation, while descending triangles indicate bearish
continuation.
Symmetrical Triangle
Indicates consolidation with no clear direction until a breakout occurs in either direction.
Rising/Falling Wedges
Rising wedges indicate bearish reversals, while falling wedges indicate bullish reversals.
Candlestick Patterns
Engulfing Patterns
Bullish engulfing indicates a reversal from bearish to bullish, while bearish engulfing signals the
opposite.
Doji
Indecision in the market. If found at the top of an uptrend or bottom of a downtrend, it could signal a
reversal.
Hammer/Inverted Hammer
Hammer signals bullish reversal after a downtrend, while Inverted Hammer suggests bullish reversal
potential.
Shooting Star
A bearish reversal pattern that occurs after an uptrend.
