7. Up/down flag pattern (probability of success above 67%)

The figure below shows the flag pattern


A flag pattern is a trend continuation pattern that can appear after a strong trend. Up flags appear in an uptrend and a bearish flag appears in a downtrend. This pattern shows a slight slowing of the trend, candles usually consist of only a small number of candles (about 20 candles) to form a pattern. The larger, larger models are not considered flag models anymore. It is referred to as price channels.

The flag pattern is small rectangles and is usually inclined to one side. Ideal chess models usually have 2 characteristics:
  • The price runs very strongly before setting the "flag" part.
  • The "flag" part appeared with a tight move at the end of that strong price wave.
The tighter the pattern, the higher the success rate will be.

The pattern is considered successful when the price breaks the upper trend line of the bullish flag or the lower trend line of the bearish body.

6. Increase/decrease triangle pattern (probability of success above 72%)

See the picture below:


The triangle pattern is a continuation pattern in trends. Similar to the flag pattern, an uptrend triangle occurs during an uptrend and a bearish triangle appears in a downtrend.

A confirmed pattern forms when the price breaks above the resistance line of the bullish triangle and vice versa.

5. Price channel pattern increase/decrease (probability of success above 72%)

See the picture below:

The price channel pattern is a trend continuation pattern. This pattern is similar to the flag pattern, the way it works and trade are similar, except that the channel pattern is formed over a longer period of time with more candles formed. These candles move in 2 parallel trend lines, these factors increase the success rate for this pattern.

This pattern forms when the price breaks the upper trend line in the up channel and the lower trend line in the downtrend channel.

4. 2 top / 2 bottom pattern (probability of success above 75%)

See the picture below:

Two bottoms two peaks are a very common reversal pattern. A 2-vertex model has 2 equal vertices, a two-bottom model is formed from two equal bottoms.

The pattern is considered successful when the price breaks the pattern's neckline.

3. 3 top / 3 bottom pattern (probability of success above 77.5%)


This is also a reversal pattern. Similar to the 2-vertex 2-bottom model, this pattern has 3 vertices or 3 bottoms formed at the same position.

A confirmed pattern forms when the price breaks the pattern's neckline.

2. Increase/decrease rectangular pattern (probability of success above 78%)

See the picture below:

This is a trend continuation pattern similar to a price channel pattern. Except that the rectangular pattern has no inclination, it is horizontal.

As a side note, the rectangular pattern was basically 2 high/low or 3 high/low failed. That is, the price does not break through the neckline to confirm the pattern. That is also why we should not catch reversal moves based on a double-bottomed pattern, because if they fail, the price will follow the previous trend.

1. Head and shoulder pattern (probability of success above 83%)


Statistically, the head and shoulders have the highest success rate of price action pattern. This is a reversal pattern consisting of 2 shoulders (2 vertices on the sides) and the head (Peak in the middle). The opposite is true of the inverse shoulder and shoulder pattern.

Ideal head and shoulders models usually have the left shoulder equivalent to the right shoulder. Pattern forms when the price breaks the neckline.