Glossary & Chart Patterns
Plain-English definitions, chart patterns and candlesticks. Free, no signup needed.
15 bite-size lessons across 5 modules, candlesticks, trend, FVGs, risk and discipline. Each ends with a quick quiz so you know it stuck.
Patterns repeat because human psychology does. Every pattern maps the tug-of-war between buyers (bulls) and sellers (bears): when buyers win you get bullish patterns, when sellers win you get bearish ones. Fear, greed, hope and panic push traders to react the same way to the same situations, across every coin and timeframe.
Patterns fall into three families:
- Continuation - the trend pauses, then resumes (flags, pennants, triangles).
- Reversal - the trend ends and turns (head & shoulders, double/triple tops & bottoms).
- Bilateral - could break either way (symmetrical triangles); wait for the actual breakout.
| Market phase | What's happening | Typical patterns |
|---|---|---|
| Accumulation | Smart money buying quietly, low volume | Bullish reversals & continuation |
| Markup / Trending | Clear directional move | Flags, triangles (continuation) |
| Distribution | Selling into strength at the top, high volume | Bearish reversals |
| Consolidation | Indecision, range tightening | Triangles, bilateral |
Chart patterns
Three peaks, middle highest. A break below the neckline often signals a top / reversal down.
Three troughs, middle lowest. A break above the neckline often signals a bottom / reversal up.
Two failed pushes to the same high (an 'M'). Buyers can't break it; price often rolls over.
Two failed pushes to the same low (a 'W'). Sellers can't break it; price often bounces.
A sharp rally (the pole), a small drift down (the flag), then continuation higher.
A sharp drop, a small drift up, then continuation lower.
Price bounces between a ceiling (resistance) and a floor (support) until one breaks.
Price spikes just below support to trigger stop-losses, then snaps back up. Often a strong reversal.
Flat resistance with higher lows squeezing into it. A break above the top often runs higher.
Flat support with lower highs pressing down. A break below the floor often drops.
Highs and lows converge to a point. Price usually breaks hard in the trend's direction.
Lower highs and lower lows narrowing. Despite the downward look, it often breaks upward.
Higher highs and higher lows narrowing. Despite the upward look, it often breaks downward.
A rounded bottom (the cup) then a small dip (the handle). A break above the rim runs up.
Three failed pushes to the same high. Buyers are exhausted; price often reverses down.
Three failed pushes to the same low. Sellers are exhausted; price often reverses up.
Candlestick patterns
Each candle shows the open, close, high and low for a period. The thick body is open→close (green = closed up, red = closed down); the thin wicks mark the high and low.
Small body up top with a long lower wick. Sellers pushed down but buyers rejected it. Bullish after a drop.
Small body down low with a long upper wick, after a downtrend. Hints buyers are stepping in.
Looks like a hammer but appears after an uptrend. A warning the rally may be running out.
Small body low with a long upper wick after a rally. Buyers tried, sellers slammed it back.
Open and close nearly equal. Indecision; the trend may pause or turn.
Open/close at the top with a long lower wick. Sellers rejected; leans bullish.
Open/close at the bottom with a long upper wick. Buyers rejected; leans bearish.
A full green body with no wicks. Buyers in control from open to close.
A full red body with no wicks. Sellers in control the whole period.
A green candle whose body fully engulfs the prior red one. Strong shift to buyers.
A red candle that engulfs the prior green one. Strong shift to sellers.
A small green candle inside the prior big red body. Selling momentum is fading.
A small red candle inside the prior big green body. Buying momentum is fading.
Two candles with matching highs after a rally. Resistance is holding.
Two candles with matching lows after a drop. Support is holding.
A red candle opens above then closes deep into the prior green body. Bearish reversal.
A green candle opens below then closes deep into the prior red body. Bullish reversal.
Big red, a small indecision candle, then a big green. A classic bottom reversal.
Big green, a small indecision candle, then a big red. A classic top reversal.
Three strong green candles in a row, each higher. Powerful bullish momentum.
Three strong red candles in a row, each lower. Powerful bearish momentum.
Terms
- Long / Short
- Long = betting the price goes up. Short = betting it goes down (you profit if it falls).
- Realized vs Unrealized P&L
- Realized = profit/loss you've locked in by selling. Unrealized = paper gain/loss on what you still hold.
- Average entry
- Your blended buy price across all your buys for a coin. P&L is measured against this.
- Risk / Reward (R:R)
- How much you stand to gain vs lose. 3:1 means you're risking $1 to make $3. The scanner only flags trades with R:R ≥ 2.
- Leverage & Liquidation
- Leverage multiplies your position (and your gains/losses). Liquidation is when a leveraged trade moves against you enough to wipe it out. At 20x, a ~5% move against you liquidates.
- Confluence
- When several independent signals agree on the same direction. More confluence = a higher-quality setup. The scanner weighs 9 of them into a 0-100 score.
- EMA (Exponential Moving Average)
- An average price that weights recent candles more. Price above the EMAs (20 > 50 > 200) = an uptrend.
- RSI
- Relative Strength Index (0-100). Momentum gauge. In an uptrend it tends to hold 40-80; below 30 is 'oversold', above 70 'overbought'.
- MACD
- Trend/momentum indicator. A bullish crossover with the histogram expanding above zero suggests upward momentum.
- Bollinger Bands
- Bands above/below a moving average that widen with volatility. Price riding the lower band can be a mean-reversion long; the upper band a short.
- ATR (Average True Range)
- How much a coin typically moves per candle. Used to size sensible stop-losses.
- Market Structure (BOS / CHOCH)
- BOS (Break of Structure) = trend continues by breaking the prior swing. CHOCH (Change of Character) = first break against the trend, a possible reversal.
- Fair Value Gap (FVG)
- A price 'gap' left by a fast move that often gets revisited. Price returning into a bullish FVG can be a long entry.
- Order Block
- The last opposite candle before a strong move. Price often reacts when it returns to that zone.
- Fibonacci / Golden Pocket
- Retracement levels (0.382 / 0.5 / 0.618). The 0.5-0.618 'golden pocket' is a favoured pullback entry zone.
- BTC Dominance
- Bitcoin's share of the total crypto market cap. Rising = money favours BTC (alts lag); falling = money rotating into alts.
- Fear & Greed Index
- A 0-100 sentiment gauge. Extreme fear can mean oversold opportunity; extreme greed can mean an overheated, risky market.
- Alt Season
- A period when altcoins broadly outperform Bitcoin, usually when BTC dominance falls and the market is risk-on.
- DCA (Dollar-Cost Averaging)
- Buying in fixed amounts over time instead of all at once, to smooth out your entry price.
Educational only, not financial advice.
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