Structure that repeats, even if outcomes don't.

A head and shoulders pattern forms after an uptrend: a peak (left shoulder), a decline, a higher peak (head), another decline, then a third peak roughly level with the first (right shoulder), followed by a break below the 'neckline' connecting the two intervening lows. It's read as a topping pattern signalling the uptrend is reversing.

The inverse head and shoulders is the same structure upside down, forming after a downtrend and signalling a potential bottom — a trough, a lower trough, a trough roughly level with the first, then a break above the neckline.

The pattern's projected target is commonly estimated as the distance from the head to the neckline, measured downward (or upward for the inverse) from the neckline breakout point — though like all chart patterns, this is a rough guide rather than a guaranteed outcome.

A double top forms when price rallies to a level, pulls back, then rallies again to roughly the same level and fails to break through — two peaks at a similar price, suggesting that level is a firm ceiling. A break below the low between the two peaks is read as confirmation of a reversal.

A double bottom is the mirror pattern: two troughs at a similar level, with a break above the high between them confirming a potential reversal to the upside.

The key structural requirement for either pattern is that the second test of the level fails, with some pullback in between — a single retest that immediately breaks through isn't a double top or bottom, it's a continuation.

A triangle forms when price consolidates between converging trend lines. An ascending triangle has a flat resistance line and a rising support line, generally read as bullish since buyers are willing to pay progressively higher prices while sellers defend a fixed level. A descending triangle is the mirror — a flat support line and falling resistance, read as bearish.

A symmetrical triangle has both lines converging toward each other, reflecting a squeeze in volatility without a clear directional bias baked into the pattern's shape itself — the eventual breakout direction is what signals the likely next move, not the triangle's shape alone.

Volume typically contracts as a triangle forms and is expected to expand on the breakout — a breakout on weak volume is generally treated with more skepticism than one accompanied by a clear pickup in participation.

A flag is a brief, roughly parallel-channel consolidation that slopes against the preceding sharp move (the 'flagpole') — a small downward-sloping channel after a sharp rally, for example. A pennant is similar but converges to a point rather than staying parallel, resembling a small symmetrical triangle after a sharp move.

Both are read as continuation patterns — a pause after a strong move before it resumes in the same direction, rather than a reversal. They tend to be shorter in duration than triangles or head-and-shoulders patterns, typically resolving within a small number of periods.

As with triangles, the projected move after the breakout is often estimated using the length of the flagpole that preceded the consolidation, though this is a rough heuristic rather than a formula with statistical backing.

A cup and handle forms as a rounded, U-shaped decline and recovery (the cup), followed by a smaller downward drift or consolidation near the prior high (the handle), before a breakout above that high. The rounded shape of the cup is read as a gradual shift from selling to buying pressure, rather than a sharp V-shaped reversal.

The handle represents a final shakeout or consolidation before the breakout, and tends to be shallower and shorter than the cup itself — a handle that retraces too deep into the cup is generally read as weakening the pattern's reliability.

Like most chart patterns, the cup and handle is more commonly discussed in the context of longer, weekly or daily timeframes than very short intraday windows, since the rounded structure needs enough time to develop clearly.

A wedge forms when both the upper and lower trend lines slope in the same direction but converge, unlike a triangle where one line is typically flat. A rising wedge — both lines sloping upward but converging — is generally read as bearish, especially after an uptrend, since the narrowing range signals weakening upward momentum despite the rising price.

A falling wedge — both lines sloping downward but converging — is generally read as bullish, particularly after a downtrend, on the same logic in reverse: price is still falling but with progressively less conviction.

Wedges can appear as both reversal patterns (at the end of an established trend) and continuation patterns (as a brief pause within a trend), which is why the broader trend context is used alongside the wedge shape itself to judge which interpretation is more likely.