Reversal Forex Graph Pattern
Studying the price pattern in the graph can be categorized into two categories namely, continuous (continuous) and reversal patterns. Discussion of continuous patterns can be seen in previous articles. Short introduction for you who want to be a trader using technical analysis or graphical readings that technical analysis is also called as an art in analyzing charts, study price charts and detect repetitive price patterns that often appear on the chart. Your ability as a trader to detect the repetition of price movement patterns in this graph is one of the successful factors for technical analysis. Because graphic patterns typically provide clear entry and exit signals, as well as price projections, stop levels and target levels.
The continuous pattern is the pattern that gives a trend of price movement to continue the previous trend. Meanwhile, the pattern of reversal is a pattern that gives a trend of price movement against the direction of the previous trend. Well, this article will discuss the reversal graph pattern.
The reversal pattern shows the high probability that the existing trend is over and there is a good chance to reverse the direction of the trend. These patterns signal entry from the beginning in the formation of new trends, making your trading profitable enough, with a fairly small stop protector. However, the trend may not immediately reverse and may even move within the ranged ranging range.
As with the continuous pattern, there must be an upward trend movement in order for a trend to reverse the trend. Without previous trends, the existing reversal pattern is invalid.
In identifying price patterns, you can use tools such as trend lines, horizontal, triangular shapes, ellipse (circle) shapes and other tools. And usually also sticking price pattern or be around support and resistance which valid or significant.
The benefit of price pattern identification is being able to see the appropriate price and target tendencies, once the price pattern successfully completes the pattern form. Of course, at the end of the pattern you should see the trend of price movement breaking or waiting for the correction. So you can get entry level, stop and optimal target.
Here are the most popular and often visible and valid continuous pricing patterns that include double tops and double bottoms, triple tops and triple bottoms, head and shoulders, wedges up and wedges down, and rounding top and rounding bottom.