JustChartsChart Patterns Explained: Head and Shoulders, Double Tops and Triangles
Chart patterns are recurring price shapes that traders use to anticipate reversals or continuations. Reversal patterns include head and shoulders and double tops or bottoms; continuation patterns include flags, pennants and triangles. A pattern is only confirmed when price breaks its key level — such as the neckline — and the classic target is the pattern’s height projected from the breakout.
Key facts
- Reversal patterns
- head and shoulders, double top/bottom
- Continuation patterns
- flags, pennants, triangles
- Confirmation
- a close beyond the neckline or trendline
- Measured target
- pattern height projected from the breakout
- Main risk
- false breakouts — use stops
Reversal patterns
Head and shoulders
Three peaks, the middle (head) higher than the two either side (shoulders), after an uptrend. The neckline joins the lows between them. A close below the neckline confirms the pattern; the measured target is the distance from head to neckline, projected down from the break. An inverse head and shoulders is the bullish mirror image after a downtrend.
Double top and double bottom
Two peaks at about the same level (an “M”) after an uptrend, or two troughs (a “W”) after a downtrend. Confirmation comes when price breaks the low between the peaks (or the high between the troughs).
Continuation patterns
Flags and pennants
A sharp move (the “pole”) followed by a short, shallow consolidation — a small channel (flag) or small triangle (pennant). A break in the direction of the pole suggests the trend continues.
Triangles
| Triangle | Shape | Usual bias |
|---|---|---|
| Ascending | Flat top, rising lows | Bullish breakout |
| Descending | Flat bottom, falling highs | Bearish breakout |
| Symmetrical | Falling highs and rising lows | Breakout in the trend’s direction, either way |
Trading patterns sensibly
- Wait for confirmation — many patterns never complete.
- Watch for retests: broken necklines often act as new support or resistance.
- Use the measured move as a guide, not a guarantee, and check the risk–reward.
- Place a stop beyond the pattern — false breakouts are common. See stop-loss placement.
- Prefer higher timeframes, where patterns are more meaningful — see choosing a timeframe.
Frequently asked questions
What is the most reliable chart pattern?
No pattern is reliable on its own. Head and shoulders and double tops/bottoms are widely watched, and patterns on higher timeframes that break with strong momentum tend to be more meaningful.
How do you calculate a chart pattern target?
Measure the pattern’s height — for example head to neckline — and project that distance from the breakout point in the breakout direction.
What is a false breakout?
When price breaks a pattern’s key level but quickly reverses back inside, trapping traders who entered on the break.
Put it into practice
Live charts, an economic calendar and trading calculators — free with a JustCharts account.
Spot patterns on a live chartThis article is for education only and is not financial advice. Trading leveraged products carries a high risk of losing money. Contract sizes, trading hours and leverage limits vary by broker and country — always check your own broker’s specifications.