Trendlines
An upward trendline connects important higher lows. A downward trendline connects important lower highs. Trendlines help visualize the direction of a market.
Common chart patterns
Some commonly studied chart patterns include:
- Triangles
- Head and shoulders
- Double tops
- Double bottoms
- Flags
- Pennants
Confirmation
Traders often wait for confirmation before acting on a chart pattern. Confirmation may come from a breakout, volume, or additional price action.