Ascending Triangle Pattern: Learn The Basic Facts

 

Ascending triangle pattern

The upward triangular pattern is bullish. This means that once the pattern is complete, the price of the security is likely to be high. This pattern is created with two trend lines. The first trend line runs along the top of the triangle and acts as a resistance point to indicate the resumption or start of the uptrend after the price has successfully exceeded. The second trend line (the bottom line of the triangle showing price support) is the up line formed by a series of highs and lows. It is this composition formed by the higher lows that forms the triangle and gives the bullish character. The basic interpretation is that every time the seller tries to lower the price, the pattern shows that they are less and less successful.

When the price of a security bounces back and forth between the two lines, an upward triangular pattern is formed. Prices will rise, inevitably face resistance, and prices will fall when securities are sold. The price may not be able to overcome the resistance several times, but this is more for the seller, as evidenced by the fact that after meeting the resistance, each sale stops at a higher level than the previous sold-out attempt. Does not lead to the power of.

Finally, prices have broken through upward resistance and continue to trend upwards. In many cases, prices are already on a general uptrend, and the rising triangular pattern is considered an integration and continuation pattern. If a rising triangular pattern is formed during the general downtrend of the market, it is generally considered a possible sign of an imminent upturn in the market.

Displaying and using the ascending triangle pattern

It is important to pay close attention to the ascension lines that support it, as the rising triangle is a bullish pattern, indicating that the bear is gradually withdrawing from the market. Bulls (or buyers) can push securities prices above the resistance levels indicated by the flat top line of the triangle.

As a trader, it is wise to be careful when entering trade entries before the price crosses the resistance line. The pattern may not be fully formed or may be violated by a downward movement. There is less risk associated with waiting for a confirmation breakout. Buyers can reasonably place stop-loss orders below the lows of the triangular pattern.