This Day On The Street
Continue to site
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

Get Your Forex Trading Insights With Chart Patterns

NEW YORK (TheStreet) -- No matter how many variations exist among foreign exchange traders on level of wealth, risk appetite or experience, each and every one of them have the same objective: What to trade next.

Many forex traders follow the latest economic developments to provide them with hints on how the forex markets will evolve, while others' trading plan is to look out for chart patterns that often occur. The latter is a simple and easy method for deciding when to trade as chart patterns can be easily spotted with some practice.

Two of the most common ones are the head & shoulders and triangles.

A very popular chart pattern searched for is the head & shoulders. As the name implies, the pattern is comprised by a "head" between two, lower shoulders. The regular head and shoulders pattern is usually formed at the top of an upwards trend and is an indication the price is about to fall.

The pattern's formation begins during the price's upward trend, when it reaches a new high and followed by a new low. This is how the left shoulder is formed.

The head of the pattern is formed when the price goes on to a new higher high and falls down to another low. Then the right shoulder is shaped when the price makes another high that is lower than the head's high and after continues to fall below the neckline.

AUD/USD Daily Easy-Forex Chart

The example above is from the AUD/USD daily chart during autumn 2013. There is is also the reverse head and shoulders pattern that forms at the end of a downwards trend and is therefore an indication of a rise in price.

1 of 2

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Real Money

More than 30 investing pros with skin in the game give you actionable insight and investment ideas.

Product Features:
  • Access to Jim Cramer's daily blog
  • Intraday commentary and news
  • Real-time trading forums
Only $49.95
14-Days Free
14-Days Free
AAPL $95.18 0.00%
FB $117.43 0.00%
GOOG $692.36 0.00%
TSLA $232.32 0.00%
YHOO $36.01 0.00%


Chart of I:DJI
DOW 17,750.91 -140.25 -0.78%
S&P 500 2,063.37 -18.06 -0.87%
NASDAQ 4,763.2240 -54.37 -1.13%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs