After understanding the role of volume in Technical Analysis in the previous article (Volume – The Perfect Beacon), today I’ll share 31 essential volume patterns. Mastering them can elevate your trading skill to a higher level.
Below are all 31 patterns with brief explanations:
Pattern 1: Volume Confirmation on Breakout
Price breaks out of a sideways range with strong volume increase, confirming an uptrend. Similar to classic Cup-and-Handle, Flag, or Triangle patterns—but the breakout must include a volume surge to be reliable.
Pattern 2: Volume Behavior by Trend (Covariant Rule)
When a downtrend weakens, price decreases while volume diminishes, indicating weakening selling pressure. As price retraces, volume rises, confirming a new uptrend forming. Traders can wait for breakout confirmation, close short positions, or enter early counter-trend buys.
Pattern 3: Volume Following Trend
Volume rises with price increases and falls with price drops. Alone, this pattern is difficult to interpret. Proper conclusions require multi-timeframe analysis.
Pattern 4: Rising Price with Weakening Volume
Price makes new highs (A, B, C) while volume decreases, signaling a potential trend reversal.
Pattern 5: Pullback After Downtrend
Price retraces upward with declining volume, confirming the downtrend. Resembles a Head-and-Shoulders pattern in reversal timing.
Pattern 6: Downtrend Confirmation
After retracement, price drops sharply with increased volume, confirming the downtrend.
Pattern 7: Covariant Rule in Both Uptrend and Downtrend
This pattern demonstrates the Covariant Rule clearly in rising and falling markets.
Pattern 8: Price and Volume Rising Together
Price increases while volume forms a corresponding upward curve.
Pattern 9: Extreme Selling Volume
Volume peaks at the lowest point of a downtrend, then price sets a bottom, breaks out, and reverses upward.
Pattern 10: Double Bottom with Declining Volume
First bottom shows peak volume; second bottom sees declining volume. Reliable bottom signal.
Pattern 11: Trendline Break with Volume
Trend reversal confirmed by price breaking a trendline with high volume at the breakout point.
Pattern 12: Distribution at Top
Volume indicates distribution at highs, followed by trend reversal downward.
Pattern 13: Distribution at Bottom
Opposite of Pattern 12, signals accumulation and upward reversal.
Pattern 14: Post-Rest Breakout
After a “rest” phase (low volume in narrow sideways range), price may break upward or downward. Similar to Triangles or Pennants.
Pattern 15: Weakening Volume on High
Price sets a high while volume declines, signaling possible reversal.
Pattern 16: Sideways Breakout with Volume
Price moves sideways (low volume), then breaks above resistance with strong volume to confirm uptrend.
Pattern 17: False Breakout
Volume declines on breakout attempt, indicating a fake breakout; price reverses downward.
Pattern 18: Genuine Breakout
Price breaks support (lower boundary) with rising volume, confirming breakout.
Pattern 19: Ideal Entry After Confirmed Breakout
Price retraces to breakout zone with declining volume—perfect high-confidence SELL entry.
Pattern 20: Obvious Volume Signal
Self-explanatory; no further explanation needed.
Pattern 21: Classic Head-and-Shoulders with Volume
Volume shows distribution and confirms the pattern.
Pattern 22: H&S Target Zone
Price target for the Head-and-Shoulders pattern after breakout.
Pattern 23: Inverse H&S and Target Zone
Breakout volume increases strongly, signaling a reversal.
Pattern 24: Double Top with Declining Volume
Second top shows volume decrease; price target follows breakout.
Pattern 25: Double Bottom
Opposite of Pattern 24.
Pattern 26: Easy-to-Understand Volume Pattern
Self-evident at this stage.
Pattern 27: Trendline Breakout Volume
Breakout confirmed by trendline breach with volume support.
Pattern 28: Reverse of Pattern 26
Opposite movement pattern.
Pattern 29: Bottom Confirmation Curve
Price establishes bottom with a curve corresponding to volume.
Pattern 30: Top Confirmation Curve
Price establishes top with a curve matching volume.
Pattern 31: Classic Cup-and-Handle
Highly reliable pattern; confirmation requires breakout with strong volume.
Mastering these 31 patterns allows you to analyze and forecast price movements more accurately. If overwhelmed, focus on a few patterns you like and apply them consistently.
For most traders, volume becomes crucial in the later stages of their journey, revealing the true power of volume signals in Forex analysis.
Thank you for reading. Feedback and discussion are welcome.
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