Remember Do not trade solely on Patterns only. Ultimately, traders should seek out the best combination of patterns and price action to create an analysis strategy that works for them. Experiment with different approaches and combinations until you discover a method that suits your trading strategy and goals.
Here are the success rates for these patterns: Inverted Head and Shoulders Pattern (83.44%) Head and Shoulders Pattern (83.04%) Bearish Rectangle Pattern (79.51%) Bullish Rectangle Pattern (78.23%) Triple Bottom Pattern (79.33%) Triple Top Pattern (77.59%) Double Bottom Pattern (78.55%) Double Top Pattern (75.01%) Ascending Channel Pattern (73.03%) Descending Triangle Pattern (72.93%) Ascending Triangle Pattern (72.77%) Bull Flag Pattern (67.13% Success) Bear Flag Pattern (67.72% Success) Bullish Pennant Pattern (54.87%) Bearish Pennant Pattern (55.19%)
These success rates presented are the result of a study conducted by a group of professional traders. They studied 10 different patterns independently from one another in 5 different markets (Forex, Futures , Equities, Crypto and Bonds), for a time period of 22 months with more than 50 case studies for each and every single pattern.
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I should've mentioned that this study was done on the 1-day time frame. The success rate for these patterns will change drastically when used on smaller time frames.
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And for the people asking about a source for this study:
Test, backtest, research, etc! Always check your strategy and test it. Thanks for sharing these stats about common patterns!
ontherunsince1905
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@TradingView, on what basis is this a editors’ pick given that he cites no source for the study he relies on? What a joke!
SLOPolarBear
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@ontherunsince1905, If you give a mouse a cookie, he's going to ask for a glass of milk.
jthrasher
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@SLOPolarBear, it's a valid comment. first off, these patterns are highly subjective and what constitutes success of the pattern? 1 tick in the expected direction? 1%, 10%, 1 day, 1 week? These are all important data points when presenting incredible percentages such as 83.4% success rate of something.
@MoonBets, that is most certainly not a study. It's a bunch of dudes with a blog saying that they've done a study. A study has sources, accessible data, etc. Not a pictogram with wild percentages and no sources. It's one thing that you're aspiring to be one more bro in a sea of bros peddling bro science (all the power to you), but disappointing to see this teenage stuff make it to TV's editors' picks, @TradingView.
H&S has a larger TP than stop loss. If that hit 83% of the time across Forex, Futures, Equities, Crypto and Bonds in all time frames I would be on a tropical Island right now being served a drink instead of trolling some guys idea on tradingview :)