lOMoARcPSD|57721483
Pdf-price-action-patterns-20-ebook-josh-trade compress
International Trade (University of Dhaka)
Scan to open on Studocu
Studocu is not sponsored or endorsed by any college or university
Downloaded by John Kim (johnbae1977@[Link])
lOMoARcPSD|57721483
PRESENT BY JOSH TRADE
PRICE ACTION
15 PRICE ACTION PATTERNS
Book By suraj saini
Downloaded by John Kim (johnbae1977@[Link])
lOMoARcPSD|57721483
Ascending Triangle
Triangle Descending Triangle Symmetrical Triangle
Falling wedge Bullish Rectangel Bullish Pennant
Rising Wedge Bearish Rectangel Bearish Pennant
Powered by joshtrade
Downloaded by John Kim (johnbae1977@[Link])
lOMoARcPSD|57721483
Double Top Head and Shoulders
Rising wedge Double Bottom
Inverse Head and Shoulders Falling Wedge
Powered by joshtrade
Downloaded by John Kim (johnbae1977@[Link])
lOMoARcPSD|57721483
Ascending Triangle
Triangle
The ascending triangle is formed in an uptrend and
indicates a continuation of the uptrend.
It is formed as a right-angled triangle with a resistance
and a slope of higher lows.
The resistance does not allow the prices of the
securities to move more upward.
The higher lows show that the buying pressure has
increased. This pattern clearly indicates that the
market moves higher as the higher lows are formed
heading toward the resistance line.
This indicates the strength of bulls and bulls are willing
to pay more for the stock.
Powered by joshtrade
Downloaded by John Kim (johnbae1977@[Link])
lOMoARcPSD|57721483
Breakout
Resistance
Powered by joshtrade
Downloaded by John Kim (johnbae1977@[Link])
lOMoARcPSD|57721483
Descending Triangle
The descending triangle is formed in the downtrend and
indicates the continuation of the downtrend.
It is formed as a downward sloping triangle with support
and a slope of lower highs.
The support does not allow the prices of the securities to
move more downward.
The lower highs show that the selling pressure has
increased.
This pattern clearly indicates that the market moving
lower as the lower highs are formed heading toward the
support line.
This indicates the strength of bears and they are willing
to sell more for the stock.
The breakout of the prices is confirmed when the prices
break from the support level with volume and continue to
move down.
Powered by joshtrade
Downloaded by John Kim (johnbae1977@[Link])
lOMoARcPSD|57721483
Breakdown
0.382
Fibo Retracement
1:4
Powered by joshtrade
Downloaded by John Kim (johnbae1977@[Link])
lOMoARcPSD|57721483
Symmetrical Triangle
A symmetrical triangle chart pattern represents a
period of consolidation before the price is forced to
breakout or breakdown.
A breakdown from the lower trendline marks the
start of a new bearish trend, while a breakout from
the upper trendline indicates the start of a new
bullish trend.
The price target for a breakout or breakdown from
a symmetrical triangle is equal to the distance from
the high and low of the earliest part of the pattern
applied to the breakout price point.
Powered by joshtrade
Downloaded by John Kim (johnbae1977@[Link])
lOMoARcPSD|57721483
Breakout
Support
R 1-3
et
es
t
Support
Powered by joshtrade
Downloaded by John Kim (johnbae1977@[Link])
lOMoARcPSD|57721483
Breakdown
Resistance
Support
st
te
e
R
Breakdown
Powered by joshtrade
Downloaded by John Kim (johnbae1977@[Link])
lOMoARcPSD|57721483
Falling wedge
A falling wedge is formed by two converging trend
lines when the stock’s prices have been falling for a
certain period.
Before the line converges the buyers come into the
market and as the result, the decline in prices
begins to lose
This results its momentum.
in the breaking of the prices from the
upper trend line.
Depending upon the location of the falling wedges
its indicates whether the trend will continue or
reverse:
Powered by joshtrade
Downloaded by John Kim (johnbae1977@[Link])
lOMoARcPSD|57721483
BreakOut
BreakOut
Resistance
Support
BreakOut
Powered by joshtrade
Downloaded by John Kim (johnbae1977@[Link])
lOMoARcPSD|57721483
Bullish Rectangel
A bullish ch
channel
annel is a continuation
continuation pattern having a
positive slope.
If the prices break from the upper channel line then it
indicates the continuation of the prior bullish trend.
Powered by joshtrade
Downloaded by John Kim (johnbae1977@[Link])
lOMoARcPSD|57721483
BreakOut
1-3
BreakOut
Powered by joshtrade
Downloaded by John Kim (johnbae1977@[Link])
lOMoARcPSD|57721483
Bullish Pennant
A bullish pen
pennants
nants pattern is formed after a sharp rise in
the prices of the stock.
After a long uptrend,
uptrend, traders try to cclose
lose their positio
position
n
with the assumption
assumption that reversal is going to come.
The prices began to consolidate as the traders start
exiting the stock.
But at the same time, new buyers start buying the stock
which result
resultss in the breakout of the prices in the same
direction as the prior uptrend.
Powered by joshtrade
Downloaded by John Kim (johnbae1977@[Link])
lOMoARcPSD|57721483
BreakOut
Bearish Trap
Support
Breakout
Powered by joshtrade
Downloaded by John Kim (johnbae1977@[Link])
lOMoARcPSD|57721483
Rising Wedge
The rising wedge in an uptrend indicates reversal to
the
It isdowntrend.
formed when the prices are making Higher
Highs and Higher Lows compared to the previous
price movements.
It gives traders opportunities to take short positions
in the market.
Powered by joshtrade
Downloaded by John Kim (johnbae1977@[Link])
lOMoARcPSD|57721483
Breakdown
Support
Breakdown
Powered by joshtrade
Downloaded by John Kim (johnbae1977@[Link])
lOMoARcPSD|57721483
Bearish Rectangel
A continuation pattern occurring in a downtrend,
downtrend,
where by traders look to enter into short positions
positions
once price breaks support and closes inside the
‘breakout zone’.
Powered by joshtrade
Downloaded by John Kim (johnbae1977@[Link])
lOMoARcPSD|57721483
Breakdown
Breakdown
1-3
Powered by joshtrade
Downloaded by John Kim (johnbae1977@[Link])
lOMoARcPSD|57721483
Bearish Pennant
A bearish pennants pattern is formed after a sharp
fall in the prices of the stock.
After a long downtrend, traders try to close their sell
position with the assumption that reversal is going
to come.
The prices began to consolidate as the traders start
exiting the stock.
But at the same time, new sellers start the shoals
[Link] selling the stock which results in the
breakout of the prices in the same direction as the
prior downtrend.
Powered by joshtrade
Downloaded by John Kim (johnbae1977@[Link])
lOMoARcPSD|57721483
Breakdown
Resistance
Support
Support
Powered by joshtrade
Downloaded by John Kim (johnbae1977@[Link])
lOMoARcPSD|57721483
Double Top
A double top chart pattern is a bbearish
earish reversal
chart pattern that is formed after an uptrend.
This pattern is formed with two peaks above a
support level which is also known as the neckline.
The first peak is formed after a strong uptrend and
then retrace back to the neckline.
After reaching back to its neckline, the price
becomes bullish and rises again to form the second
peak.
The formation of this pattern is completed when the
prices move back to the neckline after forming the
second peak.
When the prices break through the neckline or the
support level then the bearish trend reversal is
confirmed.
Powered by joshtrade
Downloaded by John Kim (johnbae1977@[Link])
lOMoARcPSD|57721483
Top 1
Top2
Breakdown
Resistance
Reest
Reest
1-3
Powered by joshtrade
Downloaded by John Kim (johnbae1977@[Link])
lOMoARcPSD|57721483
Head and Shoulders
This pattern gives a market re
reversal
versal signal post
breakdown from the neckline which is accompanied
by heavy volume. The neckline is basically the
horizontal line which joins both the troughs to each
other.
The possibility of breakdown increases if the slope of
the neckline is flat to downward sloping and the
right shoulder is relatively smaller or equal to the
left shoulder.
Another important aspect to remember is that post
breakdown from the pattern, there may be a
possibility of retest to the neckline.
The further breakdown is also accompanied with
heavy volume which gives confirmation of the
weakness.
Powered by joshtrade
Downloaded by John Kim (johnbae1977@[Link])
lOMoARcPSD|57721483
Head
Shoulder 2
Shoulder 1
Breakdown
Resistance
Support
Breakdown
Support
1-3
Powered by joshtrade
Downloaded by John Kim (johnbae1977@[Link])
lOMoARcPSD|57721483
Rising wedge
The Rising Wedge in the downtrend indicates a
continuation of the previous trend.
It is formed when the prices are making Higher
Highs and Higher Lows compared to the previous
price movements.
It gives traders opportunities to average or take
short positions in the market
Powered by joshtrade
Downloaded by John Kim (johnbae1977@[Link])
lOMoARcPSD|57721483
Breakdown
Resistance
Support
Breakdown
Support
Powered by joshtrade
Downloaded by John Kim (johnbae1977@[Link])
lOMoARcPSD|57721483
Double Bottom
A double bottom chart pattern is a bullish reversal
chart pattern that is formed after the downtrend.
This pattern is formed with two lows below its
resistance level which is also known as the neckline.
The first low is formed after a strong downtrend and
then the prices retrace back to the neckl
neckline.
ine.
Learn to Trade better with Candlesticks in 2 hours
by Market Experts
After reaching back to its neckline, the price
becomes bearish and falls again to form the second
low.
The format
formation
ion of this pattern is completed
completed when the
prices move back to the neckline after forming the
second low.
When the prices break through the neckline or the
resistance level then the bullish trend reversal is
confirmed and traders can enter a long position.
Powered by joshtrade
Downloaded by John Kim (johnbae1977@[Link])
lOMoARcPSD|57721483
Breakout
Botttom 2
Botttom 1
Breakout
Resistance
Support
Breakout
Retest
Support 2
Support 1
Powered by joshtrade
Downloaded by John Kim (johnbae1977@[Link])
lOMoARcPSD|57721483
Inverse Head and Shoulders
Inverse head and shoulders pattern indicates the
end of bearish phase and onset of an uptrend.
Traders enter a long position when the up breaks
through the resistance line. They would look for a
rise in volume to confirm the trend change. Inverse
head and shoulders pattern appears frequently in
the trendline, and since it shares many
characteristics with the head and shoulder in an
uptrend, it is also interpreted the same way.
Powered by joshtrade
Downloaded by John Kim (johnbae1977@[Link])
lOMoARcPSD|57721483
Breakout
Shoulder 2
Shoulder 1
Head
Breakout
Resistance
Support
Retest
1-3
Breakout
Powered by joshtrade
Downloaded by John Kim (johnbae1977@[Link])
lOMoARcPSD|57721483
Falling Wedge
The Falling Wedge in the downtrend indicates a
reversal to an uptrend.
It is formed when the prices are making Lower Highs
and Lower Lows compared to the previous price
movements.
It gives
the traders opportunities to take buy positions in
market.
Powered by joshtrade
Downloaded by John Kim (johnbae1977@[Link])
lOMoARcPSD|57721483
Breakout
1-3
Breakout
Powered by joshtrade
Downloaded by John Kim (johnbae1977@[Link])
