In this lesson, you will add yet another weapon: CHART PATTERNS!
Think of chart patterns as a land mine detector because, once you finish this lesson, you will be able to spot “explosions” on the charts before they even happen, potentially making you a lot of money in the process.
Chart patterns are like that funny feeling you get in your tummy right before you let a fart explode.
Don’t you wish you had a chart to detect this explosion?
In this lesson, you will learn classic chart patterns and formations.
Identifying Breakouts
When correctly identified, it usually leads to an explosive breakout, so watch out!
Remember, our goal is to spot big movements before they happen so that we can ride them out and rake in the cash.
After all, who doesn’t want to have a pool of cash to swim in like Richie Rich?
Chart formations will greatly help us spot conditions where the price is ready to break out in a certain direction.
They can also indicate whether the price will continue in its current direction or reverse so we’ll also be devising some nifty trade strategies for these chart patterns.
In a nutshell, chart patterns help you answer three questions:
- How do I find potential entry points in a rising (or falling) trend?
- How can chart patterns offer potential entry signals?
- How do I know when to get out (exit signal) either to take profit (if the chart pattern worked) or cut my losses (if the chart pattern failed)?
Here’s the list of chart patterns that we’re going to cover:
- Double Top and Double Bottom
- Head and Shoulders and Inverse Head and Shoulders
- Rising and Falling Wedges
- Bullish and Bearish Rectangles
- Bearish and Bullish Pennants
- Triangles (Symmetrical, Ascending, and Descending)
