What Is a Hidden Eye?
A hidden eye is a subtle chart pattern used in technical analysis. It appears when price consolidates in a tight range after a move, often signaling that the prior trend may resume. Traders look for it as a potential continuation signal rather than a reversal.
How the Hidden Eye Works in Practice
The pattern forms when price makes a brief, shallow pullback within a broader trend. Support and resistance levels converge, creating a narrow shape that resembles an eye. Volume often decreases during this phase and may increase when price breaks out in the direction of the trend.
Why Traders Watch for Hidden Eye Patterns
Traders use hidden eye setups to anticipate trend resumptions with a tighter risk profile. The pattern can help define a clear entry zone and a logical stop-loss level. For a more detailed explanation of chart patterns and risk management, see Investopedia.
