Let's talk about something that really works in trading. Price patterns are not just pretty shapes on a chart; they are a whole system that helps us understand where the market is heading. I've long noticed that the same formations repeat over and over again, and each time they produce roughly the same result.

You see, a price pattern is essentially the collective behavior of traders captured on the chart. History repeats itself, and the market knows it. Over many years, these patterns have proven their reliability across all major platforms. They help determine whether the trend will continue or reverse, and most importantly — where the target price will be approximately.

There are two main categories. The first — continuation patterns. They signal that the price will move further in the same direction. The second — reversal patterns. Here, everything is the opposite: the price changes its behavior and moves in the opposite direction. And that’s where it gets interesting.

One of the most recognizable price patterns is the "Head and Shoulders." It looks like this: a short peak (shoulder), then a higher peak (head), then another short peak (second shoulder). Drawing a line through the two lows — that’s the neckline. When the price breaks through this line, it’s a very reliable reversal signal. I usually place positions below this line to catch the decline. There’s also an inverted version, where everything is reversed — then the entry is above the neckline.

Next come double tops and double bottoms. A double top shows that the price tried twice to break a level but failed — a signal for a downward reversal. A double bottom is a mirror image, signaling an upward reversal. Similarly, triple tops and triple bottoms work, where the price tests the level three times. These price movement patterns often give stronger signals.

What I like about this approach is that the price pattern works because it reflects the real psychology of the market. Traders see the same thing, react in the same way, and history repeats itself. If you learn to recognize these formations, you will have a serious advantage. The main thing — don’t catch every pattern in a row, but wait for the clearest and most reliable signals.