They keep putting pressure on that resistance level and as a result, a breakout is bound to happen. We can place entry orders above the slope of the lower highs and below the slope of the higher lows of the symmetrical triangle. But, it did not occur, rising triangle pattern and the price rose over the triangle’s lower line. Additionally, a triangle’s actual signal arises after breaking the trendline. A break of the trendline is only legit after the price closes outside the triangle and remains outside it.

That’s why you should have enough experience to deal with the pattern. To gain that experience, you can use a trading demo account with Libertex. The account provides a wide range of CFDs instruments, in a risk free, simulated environment. It gives you a chance to hone your skills without using your own funds in conditions that mirror market conditions. Past performance is not necessarily indicative of future results. Leveraged trading in foreign currency or off-exchange products on margin carries significant risk and may not be suitable for all investors.

In this video, we break down the core components of the Ascending Triangle Pattern. A bearish signal, the pattern is normally observed as a continuation pattern in a down-trend but can be a powerful reversal signal when encountered in an up-trend. To trade an ascending triangle, you should open a buy position when the price breaks above the resistance level.

Price Breakout

The ascending pattern usually appears during persistent upward trends. Most technical analysts view this as a “continuation pattern,” meaning the overall market trend is likely to continue. Enter a trade at the breakout and place a stop-loss just outside the opposite side of the wedge or triangle pattern. Triangles and wedges are longer-term patterns, often witnessed on weekly charts. They can be powerful continuation or reversal patterns, depending ontheir shape and whether they are situated in an up- or down-trend.

Is an ascending triangle a reversal pattern?

A bullish signal, a falling wedge is a continuation signal in an up-trend and a reversal signal when observed in a down-trend. The ascending triangle may be regarded as a fan favorite amongst many technical traders out in the market. This is not only due to the simplicity, but the ease in assisting the setup of a trade. As with every trade, entry, exit and stop loss should be established at the start of the trade.

1. Ascending triangles tend to be bullish as they indicate the continuation of an upward trend.
2. Triangles and wedges consist of the price converging between two lines.
3. Although you can find the ascending triangle in any timeframe and for any asset, it’s a rare pattern.
4. Wait for the price to close above this level to confirm the breakout.
5. Low trading volumes, market manipulation, or sudden changes in market sentiment are common factors that cause the frequency of false breakouts.
6. It is rare to find moments where the price moves in a relatively straight line with shallow or retracements.

Here, you can map out the upper and diagonal (usually angled at around 40 degrees) trend lines. Ensure at least three swing highs/lows touch both to confirm the pattern. The rule of thumb is to enter the position once the price has broken out of the resistance. For extra confirmation, you’ll want to see a bullish candle close to prevent a false breakout.

The chance of a strong breakout is higher if the volumes are high. Primus Telecom (PRTL) formed an ascending triangle over six-months before breaking resistance with an expansion of volume. Because of its shape, the pattern can also be referred to as a right-angle triangle. Two or more rising troughs form an ascending trend line that converges on the horizontal line as it rises.

1. With this pattern, the market is rising, making higher highs and higher lows as expected.
2. The pattern should be well-defined with at least two or more touches on the ascending trendline and two or more touches on the horizontal resistance line.
3. The lower line is a support level in which the price cannot seem to break.
4. The support line for buyers is sloping upwards, while the resistance level is the upper horizontal line.

Is an Ascending Triangle Bullish?

In contrast, symmetrical triangles have converging trendlines, with neither side being dominant, resulting in a pattern that lacks directional bias and can break out either up or down. Descending triangles, however, have a flat lower trendline and a descending upper trendline, suggesting bearish sentiment as sellers repeatedly drive the price lower. Each pattern reflects different market dynamics and potential future price movements. Think wisely before choosing and make a good technical analysis to gain good profits and avoid losses. Secondly, the ascending triangle has a horizontal resistance level and upward sloping support line while a rising wedge has two converging upward sloping support and resistance trendlines.

While the price holds at the support level, the series of lower highs shows that selling pressure is increasing. This often leads to a breakdown below the support line, where the price might experience a sharp decline. Traders see the formation as a bearish signal, indicating that the market could continue its downward trend. The best way to trade ascending triangle patterns is to trade the resistance level’s breakout or the support level’s breakdown.

Falling Wedge

This article represents the opinion of the Companies operating under the FXOpen brand only. I present the information in slider format, so be sure to click the left or right arrows to view another slide. Expect the market to turn when it reaches the apex of the triangle. What is a funded trading account, how does it work, and how to get one? Learn everything you need to know about funded accounts and how they work in this guide. Nathalie Okde is an SEO content writer with nearly two years of experience, specializing in educational finance and trading content.

The price may briefly break above the resistance line only to fall back within the triangle, leading to potential losses if the trader enters prematurely. This chart shows the stock breaking out of the triangle downward (blue dot), reversing, and shooting out the top of the triangle, busting the downward breakout. Almost half (46%) of ascending triangles with downward breakouts will bust (move higher), rising an average of 36% (to the ultimate high). Most (67%) of the busts are single ones (a move down followed by a move higher), so the chance of additional up-down cycles is less. In this article, we’ll be detailing the inverse version of the well-known head and shoulders chart pattern so you can start effectively incorporating it into your trading.

It is not difficult to detect an ascending triangle in the chart since the contour of a right-angled triangle located horizontally is visually clearly traced. Technical tools are used to make predictions about future trends based on past performance. But remember that the market can be very unpredictable and can swing in any direction at any time. Despite being a continuation, traders should look for breakouts before they make a move to buy or sell.