Forex charts give clue to the market behaviour as there are patterns that repeat over time. By having an understanding of the different chart patterns, you’ll be able to spot different potentially profitable opportunities to enter the trade before it occurs.

Chart patterns will give you a clue whether the price will continue its current trend or will start to reverse.

The following are the seven most common types of chart patterns:

  1. Head and Shoulders
  2. Double Top and Double Bottom
  3. Symmetrical Triangle
  4. Ascending Triangle and Descending Triangle
  5. Flags and Pennants
  6. Triple Top and Triple Bottom
  7. Rising Wedge and Falling Wedge

These 7 common chart patterns can be further grouped into 3 main categories. They are:

Reversal Chart Patterns

When the following patterns are noted in a currency pair’s chart, it signifies that the ongoing trend will reverse:

Head and Shoulders Chart Pattern

Continuation Chart Patterns

As the name imply, when the following patterns are noted in a currency pair’s chart, it signifies that the ongoing trend will continue:

Bilateral Chart Patterns

The following chart patterns, on the other hand, are harder to predict as the currency pair may either continue the trend or reverse: