Triangles
stock chart patterns
Triangles are important stock chart patterns. They offer very good probability for continuation of a trend when the price breaks from this pattern.These chart pattern are often found during consolidation (pause) time during some strong trend move.
Ascending triangles
stock chart patterns
This version of a stock chart pattern is considered bullish. It has very good reliability if it is found in an
uptrend
. As you can see in the illustration, there is horizontal resistance at highs and a rising support line at lows.
Descending triangles
stock chart patterns
This version of a stock chart pattern is considered bearish. It has very good reliability if it is found in a
downtrend.
The resistance is a declining downtrend line, and support is at the horizontal level.
My stock market trading tip
The best trade setup is when the price breaks from the pattern. I like it very much.
This stock chart pattern can be used for swing trading strategy and day trading strategy but also in longer time frames (weeks or months) for position trading strategy.
The longer the price is inside the pattern, the stronger the move after the break from this pattern.
Analyze stock volume
When you monitor these stock chart patterns then I would like to advice you to check
volume.
The best option is when volume decrease during a time as these stock chart patterns are formed. It is OK. But you must monitor situation when stock trading volume is increasing above average levels. Then you know that something is happening. If the price is also breaking from the pattern it is good signal for entering the trade. It is very useful to have possibility to monitor
stock trading volume intraday.
Do not set large stop loss level
My golden rule of trading is that good trades are often good immediately from the beginning and rarely go too much against my idea.So I like to set up my
initial stop loss
level quite aggressive and do not want to allow trade to pullback against me too much. Another stock market trading tip I would like to stress is that intermediately as the price break from this pattern and the break holds, move
trailing stop loss
level just above/below breaking
candlestick.
Return from Triangles to stock chart patterns
|
