One subject
Chart patterns
2 lessons and 18 glossary terms cover this across the academy. Each one links to its own page, and nothing is repeated here.
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The curriculum
2 lessons cover this.
In curriculum order, which is the order you would meet them.
The glossary
18 terms belong here.
Alphabetical, each defined in one sentence on its own page.
- Ascending triangleA chart formation in which highs stall along one roughly horizontal level while lows step upward beneath it, compressing price into a narrowing space against that ceiling.
- Breakaway gapA gap that opens as price leaves a range or a chart pattern, classified by where in a move it appears rather than by anything visible in the gap itself.
- BreakoutA move carrying price beyond a level that had been containing it, such as the edge of a range or a trend line, after which chart traditions treat that level as broken.
- Dead cat bounceA short recovery inside a decline that then continues, named from the observation that a falling object can bounce without having stopped falling.
- Descending triangleA chart formation whose successive highs fall toward a level where lows keep stopping, drawn as a downward sloping upper line converging on a flat lower one.
- Double bottomTwo lows made at approximately the same level with a rally between them, counted as complete only once price closes above the high of that intervening rally.
- Double topTwo highs made at approximately the same level with a dip between them, counted as complete only once price closes below the low of that intervening dip.
- Elliott wave theoryElliott wave theory describes price as repeating sequences of five waves in the direction of the larger trend followed by three against it, nested at every scale of chart.
- Harmonic patternA price structure of four connected swings whose turning points sit at specified Fibonacci ratios of one another, named by shape: Gartley, bat, butterfly, crab and their variants.
- Head and shouldersA chart formation of three consecutive peaks in which the middle peak is the highest, with a neckline drawn through the two lows that separate them.
- Inside barAn inside bar is a price bar whose entire high to low range sits within the range of the bar before it, marking a period that did not extend beyond the previous one in either direction.
- Inverse head and shouldersAn inverse head and shoulders is a chart shape of three troughs, the middle one the deepest, joined by a neckline drawn across the two peaks that separate them.
- Key reversalA key reversal is a single bar that extends past the previous bar's extreme and then closes back through it, read by chart readers as a turn compressed into one bar.
- PennantA pennant is a short converging pause that forms after a sharp directional move, its highs stepping down and its lows stepping up over a handful of periods before the market resolves.
- Rectangle patternA rectangle pattern is a stretch of chart in which price travels between a roughly horizontal ceiling and a roughly horizontal floor, drawn once each boundary has turned the market back more than once.
- ReversalA reversal is a change in a market's prevailing direction, where a sequence of rising highs and lows gives way to a falling one or the other way round, as distinct from a pause inside the existing move.
- Triangle patternA triangle pattern is a stretch of chart in which highs and lows converge, so each swing covers less ground and the boundaries drawn through them meet at a point ahead of price.
- Wedge patternA wedge pattern is a chart shape drawn where two converging lines both slope the same way, so a market's swings narrow while the whole range still drifts up or down together.
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