Definition of Reversal Chart Patterns

Reversal Trading Patterns confirm the reversal of the xauusd market trend once this reversal chart pattern setup is confirmed.

These reversal chart patterns are formed after extended gold market trend either upward or downwards and these reversal chart patterns signal that the xauusd market trend is ready to reverse.

1. Reversal Trading Patterns

• Double Tops Reversal Chart Patterns

• Double Bottoms Reversal Chart Patterns

• Head and Shoulders Reversal Chart Patterns

• Reverse Head and Shoulders Reversal Chart Patterns

Double Tops

Double tops xauusd chart pattern is a reversal chart pattern that forms after an extended upward xauusd trend. As its name implies, this formation is made up of two consecutive peaks that are roughly equal, with a moderate trough between.

Summary:

• Double tops xauusd chart pattern forms after an extended move upwards
• Double tops xauusd chart pattern formation indicates that there will be a reversal in the xauusd market
• We sell when price breaks below the neckline point: see below for explanation.

Example of Double Tops Reversal Chart Pattern on a Gold Chart

Double Bottoms

Double bottoms xauusd chart pattern is a reversal chart pattern that forms after an extended downward xauusd trend. It is made up of two consecutive troughs that are roughly equal, with a moderate peak between.

Summary:

• Double bottoms xauusd trading chart pattern forms after an extended move downwards
• Double bottoms xauusd chart pattern formation indicates that there will be a reversal in the xauusd market
• We buy when price breaks above the neckline point: see below for explanation.

Example of Double Bottoms Reversal Chart Pattern on a Gold Chart

Head and Shoulders Chart Pattern

Head and Shoulders chart pattern is a reversal chart pattern that forms after an extended Gold Trading upward xauusd trend. It is made up of three consecutive peaks, the left shoulder, the head and the right shoulder with two moderate troughs between the shoulders.

Summary:

• Head and Shoulders chart pattern forms after an extended move upwards
• Head and Shoulders chart pattern formation indicates that there will be a reversal in the xauusd market
• Head and Shoulders xauusd trading pattern formation resembles head with shoulders thus its name.
• To draw the neckline we use chart point 1 and point 2 as shown below. We also extend this line in both directions.
• We sell when price breaks below the neckline point: see the trading chart below for explanation.

Example of Head and Shoulders Reversal Chart Pattern on a Gold Chart

Reverse Head and Shoulders Chart Pattern

Reverse Head and Shoulders chart pattern is a reversal head and shoulders chart pattern that forms after an extended Gold Trading downward xauusd trend. It resembles an upside-down head shoulders.

Summary:

• Reverse Head and Shoulders chart pattern forms after an extended move downwards
• Reverse Head and Shoulders chart pattern formation indicates that there will be a reversal in the xauusd market
• Reverse Head and Shoulders xauusd trading pattern formation resembles is upside-down, thus the name Reverse.
• We buy when price breaks above the neckline point: see the trading chart below for explanation.

Example of Reverse Head and Shoulders Reversal Chart Pattern on a Gold Chart

Reversal Chart Patterns Tutorials

Double Tops Chart Patterns and Double Bottoms Chart Patterns

Head and shoulders XAUUSD Chart Patterns and Reverse Head and Shoulders Chart Patterns