The different Chart Patterns :
Chart patterns are at the basis of technical analysis. They are distinguished into three categories: Reversal Patterns – Continuation Patterns – Neutral Patterns. Chart patterns are formed on the charts of historical data of different pairs. They appear on all timeframes.
The table below shows the ranking of chart patterns that fulfill their role as a reversal or continuation pattern. More the percentage is high, more the chart pattern is relevant. However, this does not mean that the target of the pattern is reached, but only that the exit is in the right direction depending on the nature of the pattern.
The conclusion of this study shows those reversal patterns are more relevant than continuation patterns. Indeed, the first 3 patterns are reversal patterns. Chart patterns with a higher percentage allow a more aggressive trading because it does not necessarily need to await the classic buy/sell signal of the pattern to take position.
Ranking by percentage of objective reached
The table below shows the ranking of the most powerful chart patterns. Only breakouts that occurred in the right direction (depending on whether the chart pattern is a reversal pattern or a continuation pattern) were taken into account. Patterns with the highest percentage are suitable for a conventional trading, that is to say wait the buy or sell signal of the pattern to take position.
We note that pullbacks on the line that gave the buy or sell signal are usual. For the highest percentages, it is also preferable to wait for the pullback to take position in order to not lose a part of the movement and to decrease your rsik.