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Triangle patterns are important because they help to intimate the continuation of a bearish or bullish market. The price consolidation period consists of higher lows and lower highs in a triangle chart pattern. The triangle shape is formed when the support and resistance and support lines converge.
There are three types of Triangle chart patterns
- Symmetrical Triangle Pattern
- Ascending Triangle Pattern
- Descending Triangle Pattern
The breakout point is just above the upper trend line for buying, and the breaking down point is just below the trend line for selling position is recognized entry price. The triangle height at its base is considered as exit price. In triangle chart patterns, the stop loss can be placed at the support level.
KEY THINGS TO REMEMBER
- A triangle chart pattern is considered a continuation pattern when the previous trend will continue after forming this chart pattern.
- The ascending triangle is formed in an uptrend and intimates the continuation of the uptrend.
- The descending triangle is formed in the downtrend and intimates the continuation of the downtrend.
- There are certain factors that everyone should consider when trading with the descending and ascending triangle pattern.
