![]() The shape of the triangle (ascending, descending or symmetrical) matters less. If a small triangle appears during a trend, the trend direction is what matters. On the other hand, a large triangle suggests a more significant battle between buyers and sellers, which means the market is questioning the trend. Smaller triangles are more likely to be continuation patterns-the price is pausing for a breath before continuing the trend. This can happen when you see the “flagpole” before the triangle I described above.įorex Brokers We Recommend in Your RegionĪ triangle can either be a continuation or a reversal pattern. However, if you feel confident the price will break out in a certain direction, you can enter before the breakout to get an early entry with more profit potential. Often, traders will wait for the price to break out before entering a triangle. But if you see a symmetrical triangle as part of a flagpole pattern, that indicates that the price will likely continue the move rather than reverse it. Immediately before a symmetrical triangle, if you see a strong spike up in price or dive in price down that forms an almost vertical line (known as a “flagpole”), you have a pattern called a “pennant.” When this happens, the symmetrical triangle will be likely to continue the trend.Īre symmetrical triangles better? Traders often assume that symmetrical triangles are more neutral, but ascending and descending triangles can break out in either direction-to the upside or downside-so symmetrical triangles are not necessarily more neutral. Often, traders will assume that symmetrical triangles are continuation patterns, but they can reverse the trend, especially when the triangle is larger, because that indicates a more significant battle between buyers and sellers. Like ascending and descending triangles, symmetrical triangles can be bullish or bearish depending on the market conditions when it appears. For example, does the descending triangle appear after a bearish or bullish reversal pattern, such as a head and shoulders or inverse head and shoulders? The descending triangle could have a bullish breakout if the bigger picture or preceding price action is more bullish.Ī symmetrical triangle has a lowering resistance level and a rising support level, both pushing against each other to create a narrowing range. Pay attention to the price context when the triangle appears to help predict how it may break out. Remember, a triangle is a breakout pattern, and breakouts can happen in either direction. Yet with a descending triangle, the price can break out in either direction-either to the upside or to the downside. The lower highs give the sense that the price will break through the support and begin a new bearish move. It is easy to assume a descending triangle should be bearish-it has lower highs, like an uptrend. For example, does the ascending triangle appear during a trend? Is the triangle small, indicating a pause rather than a larger reversal pattern? Then the ascending triangle will probably continue the trend, whether it is an uptrend or downtrend. ![]() Pay attention to the price context when this triangle appears, to help predict how it may break out. ![]() Yet with an ascending triangle, the price can break out in either direction-either to the upside or to the downside. ![]() The higher lows give the sense that the price will break through the resistance and begin a new bullish move. It is easy to assume an ascending triangle should be bullish-it has higher lows, like an uptrend. Let’s look at each type of pattern in more detail.Īn ascending triangle has a horizontal resistance level with a rising support level. I will explore this in more detail in the article.Ī wedge is a type of chart pattern like triangles. Most traders assume ascending triangles are bearish and descending triangles are bearish-but the price can break out in either direction from ascending or descending triangles. There are three main types of triangle trading patterns:Īll three types of triangles can be bearish or bullish.
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