Chart pattern recognition
Charting :
Pattern Recognition

Chart Pattern Recognition

 

Automated Chart Pattern Recognition and Plotting.
The new exciting automated chart pattern plotting facility has been set so that it uses by default, a range of 125 to 254 bars for the plot time frame, depending upon the particular chosen chart pattern. Users can change this range to suit themselves BUT please understand that this facility is carrying out very intense mathematical computations and is therefore VERY resource hungry. i.e. use too high a number of bars (time periods) then your PC may slow to a crawl..
Flags and Pennants

Flags and Pennants are short-lived interuptions of bullish and bearish trends, during which the price temporarily moves in the opposite direction to the trend.

They are continuation patterns, indicating that the trend will shortly resume and occur after a steep price change (increase or decrease).

Example 1

Example 2
Triangles
Ascending and Descending Triangles (also called Right-angled Triangles) are fairly reliable patterns, giving advance notice of the direction of the breakout. They are usually continuation patterns, but sometimes act as reversal patterns, signaling a change in trend.
Ascending Triangle example
In an Ascending Triangle, the price swings between a horizontal (flat) line and a rising trend line. These lines converge.
Example:
Descending Triangle example
In a Descending Triangle, the price swings between a horizontal (flat) line and a falling trend line. These lines converge.
Example:
Symmetrical Triangle
Symmetrical Triangles indicate market uncertainty. Buyers and sellers alternately drive the price up and down in a steadily narrowing range. Sometimes they act as continuation patterns, indicating that the trend will shortly resume, and sometimes they act as reversal patterns, indicating that it has ended. During the pattern formation, it is impossible to tell whether the price will break up or down. On average, about 75% of Symmetrical Triangles act as continuation patterns and 25% as reversal patterns.

Symmetrical Triangles can occur during bullish or bearish trends or periods of consolidation. During a Symmetrical Triangle, at least two peaks and two troughs are confined by converging lines.

Example:
Horn
The Horn is the opposite of a triangle and is made up of two diverging lines (instead of two converging lines).
A Horn usually indicates the end of a trend.

The Horn has three different forms.
1. They can be symmetrical.

2. Their upper line can be horizontal (open downwards).

3. Their lower line can be horizontal (open upwards).

Horns can be tops or bottoms. However, 90% of Horns are tops and therefore, they usually develop at the end of a bull trend. It is important to remember that Horns can still be bottoms or continuations.

Example: