Continuation Pattern

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



BREAKING DOWN '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. Pattern

    In technical analysis, the distinctive formation created by the ...
  2. Diamond Top Formation

    A technical analysis reversal pattern that is used to signal ...
  3. Hook Reversal

    A short-term candlestick pattern, occurring in either an uptrend ...
  4. Mat Hold Pattern

    A pattern found in the technical analysis of stocks that ultimately ...
  5. Sanku (Three Gaps) Pattern

    The Japanese word for a candlestick pattern that consists of ...
  6. Technical Analysis of Stocks and ...

    The academic study of historical chart patterns and trends of ...
Related Articles
  1. Trading Strategies

    Technical Analysis: Chart Patterns

    By Cory Janssen, Chad Langager and Casey MurphyA chart pattern is a distinct formation on a stock chart that creates a trading signal, or a sign of future price movements. Chartists use these ...
  2. Charts & Patterns

    Continuation Patterns: An Introduction

    Those random movements in the charts actually form patterns. Learn the basics of what these patterns are.
  3. Active Trading Fundamentals

    Triangles: A Short Study In Continuation Patterns

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

    Analyzing Chart Patterns: Triangles

    By Chad Langager and Casey Murphy, senior analyst of ChartAdvisor.com As you may have noticed, chart pattern names don't leave much to the imagination. This is no different for the triangle ...
  5. Charts & Patterns

    Continuation Patterns: Introduction To Triangles

    The three types of triangle continuation patterns look different, yet provide similar information. Find out how.
  6. Forex Education

    Most Commonly Used Forex Chart Patterns

    These chart patterns provide entries, stops and profit targets that can be easily seen.
  7. Chart Advisor

    Four Upside Triangle Chart Pattern Breakouts

    These four stocks just broke out of triangle chart patterns and provide upside targets as well as defined stop levels.
  8. Charts & Patterns

    Continuation Patterns - Part 2

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

    Stock Chart Patterns to Keep an Eye On

    Some of these stocks are exhibiting big chart patterns, so a breakout is likely to be significant.
  10. Forex Education

    How To Interpret Technical Analysis Price Patterns: Triple Tops And Bottoms

    Triple and double tops and bottoms may be tough to spot, but once you learn them, they can be powerful patterns.
RELATED FAQS
  1. How effective is creating trade entries after spotting a Symmetrical Triangle pattern?

    Understand the symmetrical triangle pattern and the likely success of the most common breakout trading strategy implemented ... Read Answer >>
  2. What are the main opportunities that arise when a stock exhibits a continuation pattern?

    Learn about continuation patterns and the opportunities they can present. Use these trading strategies to profit from these ... Read Answer >>
  3. How do I implement a forex strategy when spotting a Symmetrical Triangle Pattern?

    Learn the basics of the symmetrical triangle pattern and how this continuation signal can be used to create trade strategy ... Read Answer >>
  4. What are the most common continuation candlestick patterns?

    Learn about the four most common types of continuation patterns found in candlestick charts: triangles, rectangles, flags ... Read Answer >>
  5. How do I build a profitable strategy when spotting a Symmetrical Triangle pattern?

    Understand the basics of the symmetrical triangle chart pattern including formation and how to use this pattern to create ... Read Answer >>
  6. Where do I place my target when the price of a stock breaks out of a technical chart ...

    Technical chart patterns such as ascending triangles, head and shoulders and double bottoms have rapidly grown in popularity ... Read Answer >>
Hot Definitions
  1. MACD Technical Indicator

    Moving Average Convergence Divergence (or MACD) is a trend-following momentum indicator that shows the relationship between ...
  2. Over-The-Counter - OTC

    Over-The-Counter (or OTC) is a security traded in some context other than on a formal exchange such as the NYSE, TSX, AMEX, ...
  3. Quarter - Q1, Q2, Q3, Q4

    A three-month period on a financial calendar that acts as a basis for the reporting of earnings and the paying of dividends.
  4. Weighted Average Cost Of Capital - WACC

    Weighted average cost of capital (WACC) is a calculation of a firm's cost of capital in which each category of capital is ...
  5. Basis Point (BPS)

    A unit that is equal to 1/100th of 1%, and is used to denote the change in a financial instrument. The basis point is commonly ...
  6. Sharing Economy

    An economic model in which individuals are able to borrow or rent assets owned by someone else.
Trading Center