TRADING STRATEGY WITH PETTERN CHART - IQ OPTION STRATEGY

On this occasion I will explain 3 pettern chart patterns.

1.Head and Shoulders Pattern

Head and Shoulders Pattern is a pattern that looks like a head and shoulders (left and right). The head and shoulders pattern is often encountered when an uptrend is and is an indication that after this pattern is formed there is a possibility that prices will turn into a downtrend.

The foundations of the head and shoulders pattern are:

1. The first boat (number 1) is formed by higher high (HH). Here the buyer trader still dominates.
2. Head (number 2) is formed by a new higher high (HH). The buyer buyer still shows its strength But this is the "last" power.
3. On the second shoulder (number 3), the price has formed lower high (LH). The buyer trader is  unable to make a new higher high, even the buying trader is unable to lift the price equivalent to the last higher high.

The lower high formed is the first indication that the trend has ended. Buying interest has been reduced and there are not enough buyers to lift prices up again.

Breakdown of the neckline (area support) is a signal that the seller's trader has taken over the price. Now the price is controlled by the seller trader.

2.Triple Bottom Pattern

This triple bottom pattern is the opposite of the triple top pattern. The triple top is bearish because of the reversal pattern, the triple bottom is a bullish reversal which means that if you find this pattern when it is downtrend, there is a possibility of a reversal towards the uptrend.

The foundation forming the triple bottom pattern:

1. The first basis (number 1) is a lower low (LL) indication that the seller trades in control of the price by pressing the price down. This low low becomes an area of ​​support.
2. The second basis (number 2) the seller trader fails to push the price lower. Seller traders are only able to press the price to the support area. Not able to break the support to make a new lower low.
3. On the third basis (number 3) it appears that selling pressure is no longer large. Seller traders lose power to push prices deeper. Buyer traders know that oversold has occurred in this support area.This area is used by buying traders to lift prices higher breaking the resistance area and making higher highs.

Thus there has been a change of power between the seller trader and the buyer trader.

3.Double Top Pattern

Double top pattern / double peak pattern is a reversal pattern, if you find a pattern like this when the price is uptrend there is a possibility the trend will turn into a downtrend.

Double top forming foundation:

1. The first peak is formed by a higher high. In this phase the buyer trader is still seen showing his strength to lift the price higher. This higher high area automatically becomes a resistance area.
2. In the second peak it turns out that the buyer's trader is unable to lift the price higher to form a new higher high. This shows that purchase intention has been reduced. There are not enough buyers to raise prices higher. So the buyer's trader is stuck in the resistance area (the last higher high).

If you notice the seller trader starts to takeresistance which is reflected in the candlestick with a long tail up. When the seller trades successfully breaks the neckline and forms a new lower low, the trend change is confirmed.

That's how to use pettern carts in trading, try this trick and hopefully help you to make a big profit. Keep monitoring this blog because I will explain the following patterns.

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