Chart patterns are the foundational building blocks of technical analysis. They repeat themselves in the market time and time again and are relatively easy to spot. These basic patterns appear on every timeframe and can, therefore, be used by scalpers, day traders, swing traders, position traders and investors. There are 3 types of patterns, depending on how price is likely to behave after completion: reversal patterns, where price is likely to reverse, continuation patterns, where price is likely to continue its course and bilateral patterns, where price can go either way, depending on whether it breaks to the upside or to the downside.
The measurements of the chart pattern can be used to project the next price movement and what target to aim for. These patterns can either be traded aggressively (with less conformation) or conservatively (with more conformation) so the rules of entry and exit can vary. It's easy to calculate the reward / risk for them, which is important to know before entering a trade.
