Chart Patterns (37 Types): Definitions, Win Rates, and How to Trade Them
Chart patterns are repeatable price shapes that help you spot likely breakouts, trend continuation, or reversals. You trade them by waiting for confirmation (breakout/neckline break), placing a stop beyond the invalidation level, and using a measured move or structure-based target.
What is a double top pattern and how do you trade it?
Double Top Pattern is a chart formation where a security’s price rises to a high level twice, with a moderate decline in between, and signals a potential bearish reversal once it breaks below the intervening low.
The pattern resembles the letter “M” on a price-vs-time chart: a first peak (top), followed by a pullback that defines a support line (the “neckline”), then a second peak at approximately the same level as the first, and finally a decisive decline below the neckline which confirms the formation.
Key features:
A preceding uptrend: the pattern appears after bullish movement and signals a possible trend change.
Two highs at roughly equal price levels.
A trough between them that forms the neckline/support level.
Decreasing volume at the second peak and increased volume when the neckline breaks.
Example trade plan (simple):
Entry: after a close below the neckline (not at the second top).
Stop loss: above the second top (or above the neckline on a retest, if that’s your entry).
Target: measured move = (top to neckline distance) projected down from the break.
📊 Data Point: In a multi-decade study of U.S. equities, Adam & Adam double tops averaged post-breakout declines of ~16% (1990s), 13% (2000s), and 12% (2010s) in bull markets. — Thomas Bulkowski, ThePatternSite
Which chart patterns have the best win rates?
This table summarizes reported win rates and average moves for common chart patterns. Use it as a starting point, then validate results in your own market, timeframe, and execution rules.
Pattern Name | Type / Direction | 📊 Performance Metric |
|---|---|---|
Symmetrical Triangle | Neutral / Breakout | 67–88% win rate |
Dead Cat Bounce | Bearish Continuation | 77% win rate |
Bump and Run Reversal (BARR) | Reversal | 76% win rate, avg. rise ~55% |
Double Bottom | Bullish Reversal | 72% win rate, avg. rise ~50% |
Bullish Flag | Bullish Continuation | 67–70% win rate |
VCP (Volatility Contraction) | Bullish Continuation | 60–70% win rate |
Rounding Bottom | Bullish Reversal | 65% win rate, avg. rise ~48% |
Measured Move Up | Bullish Continuation | 60% win rate |
Bullish Pennant | Bullish Continuation | 60% win rate |
Bearish Pennant | Bearish Continuation | 51% win rate |
Butterfly (Harmonic) | Reversal | 45% win rate |
Falling Channel | Bearish Continuation | 35% win rate, 2.4:1 R:R |
Bearish Flag | Bearish Continuation | Profitable (no % stated) |
Rising Channel | Bullish Continuation | Positive expectancy |
High-Tight Flag | Bullish Continuation | Avg. rise ~53% |
Flagpole | Continuation | Avg. rise ~53% |
Ascending Scallop | Bullish Continuation | Avg. rise 38–54% |
Falling Wedge | Bullish Reversal | Avg. rise 17–18% |
Ascending Triangle | Bullish Continuation | Avg. rise 11–17% |
Double Top | Bearish Reversal | Avg. decline 12–16% |
Descending Triangle | Bearish Continuation | Avg. decline 14–16% |
Rising Wedge | Bearish Reversal | Avg. decline ~15% |
Head & Shoulders (Top) | Bearish Reversal | Avg. decline ~13% |
Inverse Head & Shoulders | Bullish Reversal | Avg. rise ~13% |
Diamond Bottom | Bullish Reversal | Avg. rise low-teens % |
Diamond Top | Bearish Reversal | Avg. decline ~10% |
Triple Top | Bearish Reversal | Avg. decline 15–27% |
Triple Bottom | Bullish Reversal | Avg. rise (failures −14%) |
Rounding Top | Bearish Reversal | Multimonth declines (no % stated) |
Rectangle | Continuation / Reversal | Avg. gain up to 55% |
Megaphone | Neutral / Volatile | Avg. decline ~20% |
Parabolic Curve | Exhaustion / Reversal | Avg. retrace 62–79% |
Descending Scallop | Bearish Reversal | Move ±34% / −21% |
Island Reversal | Reversal | Avg. move 5–6% |
What is a double bottom pattern and how do you trade it?
Double Bottom Pattern is a chart formation where a security’s price falls to a low level twice, with a moderate rebound between the two lows, and signals a potential bullish reversal when it breaks above the intervening high.
This pattern resembles the letter “W” on a price‐vs‐time chart: a first bottom (trough), followed by a rebound to a peak (the neckline), then a second bottom at approximately the same level as the first, and finally a decisive rise above the neckline which confirms the pattern.
A preceding downtrend before the formation begins.
Two distinct lows at roughly the same price level (though exact equality is not required).
A peak between the two lows that defines the “neckline” or resistance level.
A breakout above the neckline, ideally on increased volume, confirming the pattern’s validity.
After the breakout, the expected price advance is often estimated by measuring the distance between the bottoms and the neckline and projecting that upward.
📊 Data Point: Double bottoms produced an average rise of ~50% with ~72% of trades hitting their target. — Thomas Bulkowski, ThePatternSite
What is a bullish flag pattern and when does it break out?
Bullish Flag Pattern is a technical-chart formation where a strong upward move (flagpole) is followed by a sideways or mildly downward sloping consolidation (flag) and then a breakout upward, signalling potential trend continuation.
It begins with a sharp rise in price (the flagpole) showing strong buyer momentum. Then price enters a corrective phase, forming a narrow channel or rectangle that often slopes downward slightly (the flag) while volume diminishes. Finally, price breaks above the upper trendline of that channel and the flagpole’s vertical height is often used to set a price target.
📊 Data Point: Bullish flags succeed roughly 67–70% of the time when breakouts occur on rising volume. — Quantified Strategies Backtest Team (2023)
What is a bearish flag pattern and how do you spot it?
The Bearish Flag Pattern is a continuation chart formation where a sharp decline (flagpole) is followed by a narrow upward or sideways consolidation (flag) and a subsequent breakdown below the flag’s lower boundary, signalling that the prior downtrend is likely to resume.
Visual characteristics: a steep drop (pole), a tight counter-trend consolidation (flag), then a breakdown below the flag with rising volume.
📊 Data Point: A rule-driven bear-flag strategy produced statistically significant short-side profits across multiple equity indices. — Quantified Strategies Backtest Team (2023)
What is a symmetrical triangle pattern and what signals a breakout?
A Symmetrical Triangle Pattern is a chart-formation where two trend-lines converge—one descending from lower highs and one ascending from higher lows—creating a triangular shape before a breakout.
Volume typically declines during the formation. A breakout (either direction) is often accompanied by a surge in volume. Breakouts tend to occur somewhere between one-half to three-quarters of the way through the pattern’s lifespan.
📊 Data Point: AI-assisted testing found triangle breakouts succeeded ≈ 67–88% depending on symmetry and volatility regime. — Barchart Research Lab (2024)
What is a rectangle pattern and how do you trade the breakout?
A Rectangle Pattern is a chart formation where price trades between two roughly horizontal parallel lines of support and resistance, representing consolidation before a breakout.
Volume often diminishes inside the range and expands on the breakout. The breakout direction determines whether the prior trend continues or reverses.
📊 Data Point: High-scoring rectangles yielded ~55% average gains versus ~10% for poorly formed ones. — Thomas Bulkowski, ThePatternSite
What is the volatility contraction pattern (VCP) and how do you trade it?
The Volatility Contraction Pattern (VCP) is a chart-formation where a security in an up-trend undergoes successive pull-backs of decreasing magnitude and activity until it breaks out upward on increased demand.
The key idea is tightening price action + drying volume, followed by a breakout above the pivot/resistance from the tightest consolidation.
📊 Data Point: Empirical trader studies report 60–70% breakout success when accompanied by volume expansion. — TraderLion Research & Mark Minervini (2023)
What is a bullish pennant pattern and how do you trade it?
Bullish Pennant is a short-term continuation pattern featuring a sharp upward move (the “flagpole”) followed by a small symmetrical triangle consolidation, which is then resolved by a breakout upwards.
📊 Data Point: Upward pennant breakouts achieved their measured-move targets ~60% of the time. — Thomas Bulkowski, ThePatternSite
What is a bearish pennant pattern and when does it fail?
A Bearish Pennant Pattern is a chart-formation where a sharp downward move (“flagpole”) is followed by a brief symmetrical-triangle consolidation, then a breakdown continuing the prior decline.
📊 Data Point: Downward pennant breakouts hit their targets only ~51%, showing reduced reliability versus bullish counterparts. — Thomas Bulkowski, ThePatternSite
What is a measured move up pattern and how do you target it?
The Measured Move Up pattern is a three-leg upward movement where the second rising leg approximately mirrors the first in magnitude and time.
📊 Data Point: Average first leg +36%, correction −48%, second leg +31%; ~60% met full measure-rule objectives. — Thomas Bulkowski, ThePatternSite
What is a rising channel pattern and how do you trade it?
The Rising Channel Pattern is a chart pattern in which an asset’s price moves between two upward-sloping parallel trend lines, indicating a generally bullish trend.
Traders typically watch for bounces at support, rejections at resistance, and breaks above/below the channel for acceleration or reversal signals.
📊 Data Point: Systematic channel-breakout tests achieved positive expectancy with disciplined re-entry rules. — Quantified Strategies Backtest Team (2022)
What is a falling channel pattern and when does it reverse?
The Falling Channel Pattern is a bearish continuation or reversal chart formation in which prices oscillate between two downward-sloping parallel trendlines.
A break below the channel often signals continuation; a break above can signal reversal.
📊 Data Point: Price-channel systems win ≈ 35% of trades but maintain ~2.4 : 1 reward-to-risk, yielding long-term profit. — Quantified Strategies Backtest Team (2022)
How do you identify an ascending triangle pattern?
An Ascending Triangle Pattern has flat resistance and rising support (higher lows). It often precedes an upside breakout.
📊 Data Point: Ascending triangles averaged 17%, 11%, and 11% rises across the 1990s-2010s in bull markets. — Thomas Bulkowski, ThePatternSite
How do you identify a descending triangle pattern?
A Descending Triangle Pattern has flat support and falling resistance (lower highs). A breakdown below support confirms the pattern.
📊 Data Point: Descending triangles averaged 16%, 14%, and 16% declines over the same periods. — Thomas Bulkowski, ThePatternSite
What is a wedge pattern (rising vs. falling)?
A Wedge Pattern is a chart-formation where price consolidates between two converging trend-lines that slope in the same direction.
Rising wedge: usually bearish; confirms on a break below support.
Falling wedge: usually bullish; confirms on a break above resistance.
📊 Data Point: Tall wedges showed stronger outcomes: rising wedges (down) ~18.7% height, falling wedges (up) ~15.9%. — Thomas Bulkowski, ThePatternSite
What is a rising wedge pattern and why is it bearish?
The Rising Wedge Pattern is a chart-formation in which price moves higher between two upward-sloping converging trend-lines, signalling an impending downward breakout.
📊 Data Point: Rising wedges typically break down for mid-teen percentage declines. — Thomas Bulkowski, ThePatternSite
What is a falling wedge pattern and when does it break up?
A Falling Wedge Pattern is a chart-formation where price moves lower between two downward-sloping converging trend-lines, typically signalling a bullish breakout.
📊 Data Point: Falling wedges (bullish) deliver average rises ≈ 17–18% after confirmation. — Thomas Bulkowski, ThePatternSite
What is a cup and handle pattern and how do you confirm it?
The Cup-and-Handle pattern is a bullish continuation chart-pattern where a rounded “cup” is followed by a smaller “handle”, then a breakout above the handle’s resistance confirms the pattern.
📊 Data Point: About 47% of cup-with-handle breakouts retrace significantly; ~23% gain ≤ 15% before reversing. — Thomas Bulkowski, ThePatternSite
What is a high-tight flag pattern and why does it work?
The High-Tight Flag pattern is a bullish continuation chart pattern where a stock surges rapidly, consolidates tightly near highs, then breaks out again.
📊 Data Point: Median pole rise ≈ 53% over ~63 days, reflecting extreme momentum characteristics. — Thomas Bulkowski, ThePatternSite
What is a flagpole pattern and how does it set up breakouts?
The Flagpole Pattern is a sharp initial price move (“flagpole”) followed by brief consolidation (“flag”) and a breakout continuing the trend.
📊 Data Point: Flagpoles typically rise ~53% in ≈ two months, forming the structural base for high-tight flags. — Thomas Bulkowski, ThePatternSite
What is the bump and run reversal (BARR) pattern?
The Bump and Run Reversal (BARR) pattern is a three-phase reversal chart formation: lead-in trendline, sharp bump, then a break of the lead-in and a run in the opposite direction.
📊 Data Point: BARR bottoms ranked #1 of 39 patterns with ~55% average rise, 9% failure, 76% target achievement. — Thomas Bulkowski, ThePatternSite
What is the head and shoulders pattern (bearish reversal)?
The Head and Shoulders Pattern is a bearish reversal where a peak (“head”) forms between two lower peaks (“shoulders”). A break below the neckline confirms the reversal.
📊 Data Point: For head-and-shoulders tops, average post-neckline declines ≈ 13%, ranking mid-tier among bearish setups. — Thomas Bulkowski, ThePatternSite
What is an inverse head and shoulders pattern (bullish reversal)?
Inverse Head and Shoulders Pattern is a bullish reversal with three troughs (middle is lowest). A break above the neckline confirms the reversal.
📊 Data Point: Head-and-shoulders bottoms showed average rises ≈ 13% after upward breakouts, with wider patterns performing best. — Thomas Bulkowski, ThePatternSite
What is a triple top pattern and how do you confirm it?
The Triple Top is a bearish reversal with three similar highs at resistance. A breakdown below the neckline confirms the pattern.
📊 Data Point: High-score triple tops declined ~27%, low-score ones ~15%, underscoring selectivity. — Thomas Bulkowski, ThePatternSite
What is a triple bottom pattern and how do you trade it?
The Triple Bottom Pattern is a bullish reversal with three similar lows at support, followed by a breakout above resistance (neckline).
📊 Data Point: Failed triple bottoms still dropped ~14% after invalidation, highlighting asymmetric risk. — Thomas Bulkowski, ThePatternSite
What is a rounding bottom pattern and why is it bullish?
The rounding bottom is a bullish reversal where price gradually shifts from downtrend to uptrend, forming a smooth U-shape. The pattern confirms on a break above the neckline.
Long formation (weeks to months or longer).
Volume often falls into the bottoming phase and rises into the breakout.
📊 Data Point: Average rise ~48%, failure ~4%, 65% meet price target across nearly 1,000 examples. — Thomas Bulkowski, ThePatternSite
What is a rounding top pattern and when does it break down?
A rounding top is a bearish reversal where an uptrend flattens into a dome shape, then breaks down below base support.
📊 Data Point: Rounding tops rank among the strongest bearish reversals, producing sizable multimonth declines. — Thomas Bulkowski, ThePatternSite
What is a diamond top pattern and how do you spot it?
The Diamond Top Pattern is a bearish reversal where volatility expands then contracts into a diamond shape, followed by a breakdown.
📊 Data Point: Diamond tops typically produce ~10% average declines, performing better when tall and wide. — Thomas Bulkowski, ThePatternSite
What is a diamond bottom pattern and how do you trade it?
The Diamond Bottom Pattern is a bullish reversal where volatility expands then contracts into a diamond shape, followed by an upside breakout.
📊 Data Point: Diamond bottoms show low-teen-percent average rises, with wider structures achieving better follow-through. — Thomas Bulkowski, ThePatternSite
What is a dead cat bounce pattern and how do you trade it?
The Dead Cat Bounce is a temporary rebound in a falling asset that fails and continues the downtrend.
📊 Data Point: Shorting after the initial rebound succeeded in ~77% of 43 tested trades. — Thomas Bulkowski, ThePatternSite
What is a parabolic curve pattern and when does it crash?
The Parabolic Curve Pattern is a steeply accelerating uptrend that often ends with a sharp reversal after breaking the curved support line.
📊 Data Point: Parabolic rallies commonly retrace 62–79% back to the 50–61.8% Fibonacci zone within days. — Topstep Research Desk (2024)
What is an inverted cup and handle pattern (bearish)?
The inverted cup and handle pattern is a bearish pattern where an inverted rounded top is followed by a smaller handle, then a breakdown below handle support confirms continuation lower.
📊 Data Point: Inverted cups post average declines ≈ 17–19% depending on decade and market phase. — Thomas Bulkowski, ThePatternSite
What is a megaphone pattern and what does it signal?
The Megaphone Pattern (broadening formation) has expanding swings: higher highs and lower lows between diverging trendlines. It signals volatility and uncertainty until a confirmed break.
📊 Data Point: Broadening (megaphone) tops underperform on average but still yield ~20% declines on confirmed breaks. — Thomas Bulkowski, ThePatternSite
What is an island reversal pattern and how reliable is it?
The Island Reversal Pattern isolates a cluster of bars between two gaps. The second gap in the opposite direction signals a possible reversal.
📊 Data Point: Typical move size ≈ 5–6%, explaining their relatively weak predictive power. — Thomas Bulkowski, ThePatternSite
What is a descending scallop pattern and how do you spot it?
The Descending Scallop pattern is a rounded, backward-J shaped structure often occurring in up-trends and signalling a bearish reversal on a break below the valley/stem.
📊 Data Point: High-score descending scallops gained ~34% (up) or lost ~21% (down) versus ~10% for weak setups. — Thomas Bulkowski, ThePatternSite
What is an ascending scallop pattern and how do you trade it?
The Ascending Scallop Pattern is a gently curved J-shaped continuation pattern in an uptrend. It confirms when price closes above the scallop’s high (the “lip”).
📊 Data Point: Ascending scallops averaged ~38–54% rises across multiple decades of data. — Thomas Bulkowski, ThePatternSite
What is a butterfly harmonic pattern and how does it work?
The Butterfly Chart Pattern is a harmonic reversal with four legs (X→A, A→B, B→C, C→D) built around Fibonacci retracement/extension rules. The reversal is expected near point D.
A→B is typically ~78.6% retracement of XA.
B→C is typically 38.2%–88.6% retracement of AB.
C→D extends beyond X (often 127%–161.8% of XA, or 161.8%–261.8% of BC).
📊 Data Point: Harmonic butterfly tests on FX pairs achieved ~45% win rate and ~0.29% mean trade return, depending on rule precision. — Quantified Strategies Backtest Team (2025)
How do you turn chart-pattern knowledge into measurable trading improvement?
The edge from chart patterns comes from consistent confirmation rules, consistent risk management, and tracking your real results. Journal each pattern trade with the setup quality, entry trigger, stop placement, target logic, and outcome so you can compare your personal stats to the win-rate and average-move expectations above.
Over time, logging context—market regime, pattern quality, entry trigger, and post-trade notes—lets you refine rules around selectivity and sizing. Using a structured tracker with analytics makes it easier to monitor statistics, spot recurring mistakes, and build decision-making habits grounded in evidence rather than memory. For more on how trading order execution works and the importance of best execution, see FINRA’s investor guidance on best execution, and for a primer on how technical analysis is commonly defined and used, see Investopedia’s technical analysis overview.