Best Way to Use Chart Patterns
Hello, my name is Saman Jalilian, and today I'm going to teach you the best way to use chart patterns 📊.
One of the most common things you encounter when learning technical analysis and trading is chart patterns, which are frequently seen on the charts.
However, we can't just enter a trade by merely spotting a pattern. To effectively use them, we need to follow certain guidelines to achieve the best results.
Only trade patterns that meet the following criteria:
1.There should be a trend before the pattern that is at least the height of the pattern.
2.The first peak or trough created by the pattern must be at a price saturation point. You can identify this saturation using the RSI indicator, Bollinger Bands (BB), or visually.
3.The trend leading to the subsequent peaks or troughs should be weaker compared to the first peak or trough.
4.The pattern should be clean and easily recognizable.
For instance, see the double bottom pattern on the gold chart above, which meets all these criteria.
Trading Strategy✔
Set your stop-loss at half or the full height of the pattern.
Your minimum target should be the height of the pattern, and you can expect even more 📈.
📊 Happy Trading!
Categories
Trend Analysis
Support and Resistance
Chart Patterns
#Tradecitypro #TCP #ChartPatterns #TradingTips #TechnicalAnalysis #chart_pattern
Feel free to like, comment, and share your thoughts! 💬✨
One of the most common things you encounter when learning technical analysis and trading is chart patterns, which are frequently seen on the charts.
However, we can't just enter a trade by merely spotting a pattern. To effectively use them, we need to follow certain guidelines to achieve the best results.
Only trade patterns that meet the following criteria:
1.There should be a trend before the pattern that is at least the height of the pattern.
2.The first peak or trough created by the pattern must be at a price saturation point. You can identify this saturation using the RSI indicator, Bollinger Bands (BB), or visually.
3.The trend leading to the subsequent peaks or troughs should be weaker compared to the first peak or trough.
4.The pattern should be clean and easily recognizable.
For instance, see the double bottom pattern on the gold chart above, which meets all these criteria.
Trading Strategy✔
Set your stop-loss at half or the full height of the pattern.
Your minimum target should be the height of the pattern, and you can expect even more 📈.
📊 Happy Trading!
Categories
Trend Analysis
Support and Resistance
Chart Patterns
#Tradecitypro #TCP #ChartPatterns #TradingTips #TechnicalAnalysis #chart_pattern
Feel free to like, comment, and share your thoughts! 💬✨
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.