How to Read Reversal Chart Patterns for Beginner Traders

The common reversal chart patterns used to trade forex that beginner forex trades should know are described below.

Reversal Chart Patterns

The commonly used forex reversal chart patterns are:

Double Tops Reversal Chart Pattern

Double tops forex pattern is an M shaped two tops or 2 peaks pattern that forms on the forex price chart during a upward forex trend.

Double tops forex pattern is a bearish forex pattern that forms when price reaches a resistance zone.

The forex price will move upward & then dip slightly then turn up & move up to the top level where it had reached or slightly below this level then move downward again forming what is known as a double top chart pattern.

Double Bottoms Reversal Chart Pattern

Double bottoms forex chart pattern is a W shaped two bottoms or two lows forex pattern that forms on the forex price chart during a downward forex trend.

Double bottoms forex chart pattern is a bullish forex pattern that forms when price reaches a support zone.

The forex price will move downward in then move upwards slightly then turn downward and move downward to the bottom level where it had reached or slightly above this level then move upwards again forming what is known as a double bottoms trading pattern.

Head & Shoulders Reversal Chart Pattern

Head and Shoulders pattern is a bearish reversal chart pattern that forms after a upward forex trend.

There is an initial peak which is the first shoulder then a slight dip in the forex price, then a second higher peak which is the head then another forex price dip followed by the last peak in forex price which is the second shoulder.

The lowest points between the two forex price lows forms the neckline and the reversal forex trading signal from this head and shoulders reversal chart pattern is confirmed once forex price moves below this neckline.

Reverse Head and Shoulders Reversal Chart Pattern

Reverse Head & Shoulders chart pattern is a bullish reversal pattern that forms after a downward forex trend.

There is an initial dip which is the first inverse shoulder then a slight peak in forex price, then a second lower dip which is the reverse head then another forex price peak followed by the last forex price dip in forex price which is the second inverse shoulder.

The highest points between the two forex price peaks forms the neck-line & the reversal forex trading signal from this reverse head & shoulders pattern is confirmed once forex price moves above this neckline.

How to Read Reversal Chart Patterns for Beginner Traders