Continuation Pattern

AAA

DEFINITION of 'Continuation Pattern'

A technical analysis pattern that suggests a trend is exhibiting a temporary diversion in behavior, and will eventually continue on its existing trend.


The symmetrical triangle charts displayed below are both exhibiting a continuation pattern. Notice how the chart extends above (below) its existing pattern.

Continuation Pattern



INVESTOPEDIA EXPLAINS 'Continuation Pattern'

Continuation patterns tend to be the most accurate when the trend has existed for around one to three months.

The most common types of continuation patterns are triangles, flags and wedges.

RELATED TERMS
  1. Trend

    The general direction of a market or of the price of an asset. ...
  2. Chartist

    An individual who uses charts or graphs of a security's historical ...
  3. Flag

    A technical charting pattern that looks like a flag with a mast ...
  4. Triangle

    A technical analysis pattern created by drawing trendlines along ...
  5. Technical Analysis

    A method of evaluating securities by analyzing statistics generated ...
  6. Wedge

    In technical analysis, a security price pattern where trend lines ...
Related Articles
  1. Trading Strategies

    How do I implement a forex strategy when spotting a Rising Three Methods Pattern?

    Learn how to implement a forex trading strategy designed to profit from a trend continuation signal given by the rising three methods candlestick pattern.
  2. Forex Strategies

    Are continuation patterns useful in forex trading and stock trading?

    Learn what a continuation pattern is in technical analysis and why it is useful in forex and stock market trading, and discover some potential pitfalls.
  3. Charts & Patterns

    What trading opportunities does an ascending triangle offer?

    Recognize and utilize an ascending triangle formation on a chart to determine trading opportunities that anticipate a market's likely future movement.
  4. Active Trading Fundamentals

    Triangles: A Short Study In Continuation Patterns

    Learn how to read these formations of horizontal trading patterns.
  5. Charts & Patterns

    Continuation Patterns: In-Depth Look At Triangles

    We take a closer look at ascending and descending triangles to help traders predict the ultimate breakout direction.
  6. Charts & Patterns

    Continuation Patterns: Rectangles and Pennants

    Flags and pennants indicate direction of activity of the prevailing trend. Learn how.
  7. Charts & Patterns

    Continuation Patterns: An Introduction

    Those random movements in the charts actually form patterns. Learn the basics of what these patterns are.
  8. Options & Futures

    Trade Forex With A Directional Strategy

    Opening long or short positions to cash in on a trend is one of the simplest ways to trade forex.
  9. Forex Education

    Forex Consolidation Trading - Trade The Calm, Profit From The Storm

    Capture quick profits with the powerful directional biases of these two patterns.
  10. Charts & Patterns

    Continuation Patterns - Part 2

    Take a closer look at triangles, which appear in ascending, descending and symmetrical forms.

You May Also Like

Hot Definitions
  1. Treasury Bond - T-Bond

    A marketable, fixed-interest U.S. government debt security with a maturity of more than 10 years. Treasury bonds make interest ...
  2. Weight Of Ice, Snow Or Sleet Insurance

    Financial protection against damage caused to property by winter weather specifically, damage caused if a roof caves in because ...
  3. Weather Insurance

    A type of protection against a financial loss that may be incurred because of rain, snow, storms, wind, fog, undesirable ...
  4. Portfolio Turnover

    A measure of how frequently assets within a fund are bought and sold by the managers. Portfolio turnover is calculated by ...
  5. Commercial Paper

    An unsecured, short-term debt instrument issued by a corporation, typically for the financing of accounts receivable, inventories ...
  6. Federal Funds Rate

    The interest rate at which a depository institution lends funds maintained at the Federal Reserve to another depository institution ...
Trading Center