Let’s examine how to trade triangle chart patterns.
A triangle chart pattern involves price moving into a tighter and tighter range.
And as time goes by, it provides a visual display of a battle between bulls and bears.
The triangle pattern is generally categorized as a “continuation pattern.”
After the pattern is completed, it’s assumed that the price will continue in the trend direction it was moving before the pattern appeared.
A triangle pattern is generally considered to be forming when it includes at least five touches of support and resistance.
For example, three touches of the support line and two for the resistance line. Or vice versa.
Just like there are three little pigs, there are three types of triangle chart formations:
- symmetrical triangle,
- ascending triangle, and
- descending triangle.
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