Continuation Patterns XAUUSD Trading Patterns
When these continuation chart patterns are formed on the trading chart they confirm that the ruling Gold price trend is going to continue heading in the same direction.
These continuation chart patterns are used by Gold traders to identify half-way points of the market trend: this is because these continuation patterns form at the half-way point of a trend.
There are 4 types of continuation chart patterns:
- Ascending triangle
- Descending triangle
- Bull flag/pennant
- Bear flag/pennant
Rising Triangle Continuation Pattern
The ascending triangle chart pattern is formed in an up trend & it shows that the upward direction of the price is going to continue in. It shows that there is a resistance zone that the buyers(bulls) keep pushing each time moving it higher, & once it breaks, the market will continue moving upward.
The overhead resistance temporarily halts the Gold market from moving higher, while the ascending trend line beneath the pattern signals that the buyers(bulls) are still present. An up-side penetration of the upper trend line is a technical buy trade signal for a market breaking out from an ascending triangle. This continuation chart pattern is found within a Gold prices upwards trend, the ascending triangle develops/forms as a consolidation period within the uptrend & reflects up-side continuation will follow.
Rising Triangle Continuation Pattern
The market developed formed an ascending triangle pattern during its upwards trend which led to an up-side continuation. The buy point is when price clears the upper slanting line and the market continues heading upwards.
Falling Triangle Pattern
The descending triangle pattern is formed in a downtrend and it shows that the downward direction of market movement is going to continue. It shows that there is a support zone that the sellers(bears) keep pushing each time moving it lower, and once this support zone breaks, the market will continue heading downward.
The support zone temporarily halts the market from declining/falling, while the descending sloping line above the pattern signals that sellers(bears) are still present. A down-side penetration of the lower line is a technical sell signal for a market breaking downward from a descending triangle chart pattern a signal indicating that selling will follow.
Found within a Gold price downtrend, the descending triangle develops/forms as a consolidation period within the downtrend & reflects down-side continuation will follow.
Falling Triangle Continuation Setup
The market developed formed a descending triangle during its downtrend which led to further selling and a continuation of the downwards trend. The technical sell signal is when the price breaks the lower horizontal slanting line as selling resumes to push the market lower.
Bull Pennant/Flag
This continuation setup forms what resembles a rectangle. The rectangle is formed by two parallel lines that act as support and resistance for the price until the price breaks out. In general, the flag will not be perfectly flat but it will be sloping.
The bull flag is found within a Gold price upward trend. In this continuation chart pattern the market price retraces slightly and this pattern can be considered as a slight retracement with narrow price action that has a small downwards tilt. The technical buy point is when price penetrates upper line of flag. The flag portion has highs and lows which can be linked by small lines that are parallel, giving it look of a small channel.
The pennant pattern occurs at half-way point of a bullish upward trend & after a break out a similar move equal to the height of the flag pole is expected.
Bull Flag Pennant Continuation Setup
The bull pennant continuation chart pattern above was just a resting period as the market gathered strength to breakout & move higher. The continuation trade signal was completed/confirmed when the upper line was broken to the up side.
Bear Flag/Pennant Setup
This bear flag is found in a Gold price downward trend. The bear flag is a continuation chart pattern where the price retraces slightly/a little with a narrow price action that has a small upward tilt. The technical sell point is when price penetrates lower line of inverted flag. The pennant portion has highs and lows that can be linked by small lines which are parallel, giving it the look of a small channel.
Bear Flag Pennant Setup
The bear flag pennant chart pattern above was just a resting period for the market before more selling. The continuation trade signal was completed/confirmed when the lower line was broken to the down side.
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