The triangle provides the trader with several parameters to help make a decision about opening a position:
• current market trend,
• volatility dynamics,
• optimal entry point.
There are three types of basic triangles:
↗️ Bullish triangle
— this is a bullish price growth pattern that forms in an uptrend as a continuation of the trend, or in a downtrend as a reversal figure.
↘️ Bearish triangle
— is the opposite of an ascending triangle. The low of a descending triangle is usually a flat support level, while its upper side slopes downward as the price reaches lower highs. This figure can indicate weakening support and an approaching breakdown downward.
➡️ Symmetrical triangle
— it has no horizontal line, both sides have the same angle of inclination relative to each other. And it does not signal a trend reversal and does not confirm the direction of the trend. When a symmetrical triangle figure forms on the chart, it indicates that within the selected time segment, the interests of buyers and sellers are balanced, and trading becomes risky.
The conservative trading strategy for the triangle is to open a position at the moment when the price candle breaks through the straight side of the triangle and tests it. Such a breakout indicates further price dynamics within the specified trend, meaning further growth or decline in the asset's value.
Important: When working with the triangle, you may encounter false signals. Not every breakout of one of the triangle's sides leads to a trend change or price spike. The reliability of such a signal depends on the timeframe and the number of candles outside the figure.
Which triangle do you find more attractive?
👌🏻 - Bullish
🔥 - Bearish
👍 - Symmetrical