When observing market trends, we often see some recognizable price patterns, such as the letter W, the letter M, or a gradually narrowing triangle. Understanding the shifts in the strength between bulls and bears behind these shapes can provide more reference points when analyzing the charts.

First, let's talk about the structure like W, commonly known as a double bottom. It looks like the price first drops to a low, then rebounds, and afterward revisits nearly the same level before bouncing back up, forming a W-like outline. This pattern usually indicates that at that price level, buyers are relatively strong, and selling pressure struggles to push the price lower. If later the price can steadily stay above the high point of that rebound (which can be seen as a confirmation line), then the bulls often regain control. Based on past experience, once upward momentum opens space, the price often moves upward by roughly the same magnitude as the vertical distance from the W bottom to this confirmation line.

There is a contrasting shape, resembling an inverted M, known as a double top. The price attempts to rise twice to similar high points but fails to stabilize, forming two distinct peaks. This suggests that there is significant selling pressure in that area, and buyers are temporarily unable to break through effectively. If afterward the price continues to fall and breaks below the middle correction low, the double top structure is essentially confirmed, and a downward move dominated by bears may unfold. It’s worth noting that the depth of the decline often references the distance from the double top’s peak to that confirmation line.

In addition, symmetrical triangles frequently appear in the market. During price fluctuations, the highs get progressively lower, and the lows get progressively higher, connecting these points forms a gradually narrowing, roughly symmetrical triangle. This pattern often reflects that both buyers and sellers are observing and waiting, with forces balancing out, causing the trading range to contract increasingly. When the price reaches the end of the triangle, a new directional move is likely to occur.

By familiarizing yourself with these common price patterns, you can develop a rough outline in your mind when analyzing charts. Of course, the market does not follow absolute rules, but these shapes can provide some clues. Combining them with other factors will lead to more reliable analysis.