How to Read Different Types of XAUUSD Chart Patterns for Beginner Traders
Continuation Chart Patterns
Continuation Chart Patterns
Pennant xauusd chart pattern is a continuation pattern that looks like a symmetrical triangle in shape and is drawn using support & resistance lines.
Pennant chart pattern occur during a xauusd trend - either upwards trend or downwards trend. These pennant chart patterns signal consolidation periods of the xauusd price.
Bullish pennant chart pattern - occurs during an upward xauusd trend direction and this bullish pennant chart pattern shows that xauusd price has the potential to move upwards and continue in the overall upward xauusd trend direction.
Bearish pennant trading pattern - occurs during a downward xauusd trend direction and this bearish pennant chart pattern shows that xauusd price has the potential to move downwards and continue in the overall downward xauusd trend direction.
Continuation Chart Patterns
XAUUSD wedge chart patterns are continuation chart patterns.
Bullish wedge xauusd chart pattern - Rising Wedge, Ascending Wedge, Ascending Triangle is a bullish continuation chart pattern that signals xauusd prices are likely to continue moving upwards once xauusd prices move above this rising wedge chart pattern - ascending wedge xauusd chart pattern.
Bearish wedge xauusd chart pattern - Falling Wedge, Descending Wedge, Descending Triangle is a bearish continuation chart pattern that signals xauusd prices are likely to continue moving downwards once xauusd prices move below this falling wedge chart pattern - descending wedge xauusd chart pattern.
Continuation Chart Patterns
Rectangle xauusd chart pattern is a trend continuation pattern & this pattern has horizontal support & resistance areas.
Bullish rectangle pattern - When a rectangle pattern forms during a xauusd upward trend it signals an upward xauusd trend move is likely to follow next once xauusd price breakout of this xauusd triangle chart pattern.
Bearish rectangle pattern - When a rectangle pattern forms during a xauusd downward trend it signals a downward xauusd trend move is likely to follow next once xauusd price breakout of this xauusd triangle chart pattern.
Reversal Chart Patterns
Double Top Chart Pattern
Double tops xauusd pattern is a reversal chart pattern that forms after a xauusd uptrend & this xauusd pattern forms 2 tops at approximately the same level.
Bearish Reversal XAUUSD Signal - Double tops xauusd pattern is a bearish reversal xauusd trading signal.
Double Bottom Chart Pattern
Double bottoms xauusd pattern is a reversal chart pattern that forms after a xauusd downtrend & this xauusd chart pattern forms 2 bottoms at approximately the same level.
Bullish Reversal XAUUSD Signal - Double bottoms xauusd chart pattern is a bullish reversal xauusd trading signal.
Head & Shoulders Chart Pattern
Head & Shoulders pattern is a reversal xauusd pattern which forms at the top of an upward xauusd trend. Head and Shoulders pattern is a bearish reversal chart pattern that forms after a xauusd upwards trend.
There is an initial peak which is the first shoulder then a slight dip in the xauusd price, then a second higher peak which is the head then another xauusd price dip followed by the last peak in xauusd price which is the second shoulder.
The lowest points between the two xauusd price lows forms the neckline & the reversal xauusd signal from this head and shoulders pattern is confirmed once xauusd price moves below this neckline.
Reverse Head and Shoulders Chart Pattern
Reverse Head & Shoulders pattern is a reversal xauusd pattern that forms at the bottom of a downward xauusd trend. Reverse Head and Shoulders chart pattern is a bullish reversal chart pattern that forms after a xauusd trading downwards trading trend.
There's an initial dip which is the first inverse shoulder then a slight peak in xauusd price, then a second lower dip which is the reverse head then another xauusd price peak followed by the last xauusd price dip in xauusd price which is the second inverse shoulder.
The highest points between the two xauusd price peaks forms the neck-line & the reversal xauusd signal from this reverse head and shoulders pattern is confirmed once xauusd price moves above this neckline.
Consolidation Trading Patterns
Consolidation xauusd Chart patterns are also known as symmetric triangles - the consolidation pattern looks like a symmetrical triangle.
Symmetrical triangle chart pattern signal a consolidation in the xauusd price & a xauusd price breakout is likely to happen on either side once the xauusd price breaks out of this consolidation triangle chart pattern.
XAUUSD traders will wait for the xauusd price to break out in one direction before opening a xauusd trade in direction of the xauusd price breakout.
Summary:
Continuation Chart Patterns: Pennants - bullish pennant and bearish pennant, Wedges - Ascending wedge and descending wedges and Rectangles
Reversal Chart Patterns: Double Tops, Double Bottoms, Head and Shoulders, Reverse Head and Shoulders
Consolidation Chart Patterns: Symmetrical Triangles
How to Read Different Types of XAUUSD Chart Patterns for Beginner Traders
