2-2 Continuation Patterns

In the strat trading, 2-2 continuation consists of two directional bars in the same direction, either up or down. This represents that the previous trend will continue. 

We use 2-2 continuation patterns in the strat to determine the future trend on higher timeframes. After aligning the trend on higher timeframes, we can trade accurately on the lower timeframes. 

There are mainly two types of 2-2 continuation patterns:

• 2-2 Bullish continuation pattern 
• 2-2 Bearish continuation pattern 

2-2 Bullish continuation 

When a 2U candlestick follows a 2U candlestick, a 2-2 bullish continuation pattern forms on the chart. This indicates that the previous bullish trend will continue. 

To identify 2-2 bullish patterns, you should follow the following rules:

1. Find the trend within candlesticks by identifying the formation of higher highs and higher lows. 
2. The next candlestick should open within the range of the previous candlestick and must break the previous 2U candlestick. 
3. The break of the previous 2U candlestick will confirm the continuation of the bullish trend.

2-2 bearish continuation 

When a 2D candlestick is followed by another 2D candlestick, then a 2-2 bearish continuation pattern forms, predicting that the previous bullish trend will continue. 

To find a high probability 2-2 bearish pattern, you should follow the following rules:

1. Identify the trend within candlesticks. They must form lower lows and higher lows. 
2. The next candlestick must open within the range of the previous candlestick and break below the low of the last 2D candlestick.
3. The break of the low will confirm the continuation of a previous bearish trend. 

Examples

Here are few examples :

The psychology behind the 2-2 continuation pattern 

The directional bar always shows a direction according to the strat rules. It is also represented by number 2. The directional bar also shows the momentum of buyers or sellers. 

For example, if the previous trend is bullish, a bullish directional bar will form. Then, the next candlestick again breaks the high of the previous directional bar, showing that the momentum of buyers is still bullish. And they want to continue the trend because they have cleared the barrier on the way to an uptrend by breaking the previous high. That’s why these are trend continuation patterns. 

Conclusion 

In strat trading, before finding a setup for intraday timeframes, we always first align the higher timeframes, such as monthly, weekly, daily, and 4H. We must see the formation of these 2-2 continuation patterns on these higher timeframes. For example, suppose all the above 4 higher timeframes make a 2-2 bullish continuation. In that case, we must find only bullish trade setups and trade in only bullish direction on the intraday timeframe.