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📚Trading Lesson. Triangle Types & How to Read Them📚

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BITFINEX:BTCUSD   Bitcoin / U.S. Dollar

Triangle is a classic price action pattern that is applied by technical analysts to make predictions trading different financial markets.

Depending on the shape of the triangle, there are three main variations of this pattern.
Its meaning changes dramatically from one to another so it is crucially important for you to know the difference.

👉 The symmetrical triangle is determined by two contracting trend lines .
The pattern is considered to be indecisive meaning that while the market is stuck within, the directional bias is unknown.

Only the breakout of a boundary of a triangle clarifies the future direction.

👉 In contrast, the ascending triangle (also called a bullish accumulation) is a classic example of a bullish biased pattern.
With a horizontal trend line serving as resistance and a rising trend line service as support, the market is accumulating volumes for a bullish breakout.

Once the horizontal resistance is broken, bullish continuation follows.

👉 The descending triangle is a bearish biased pattern. Also called a bearish accumulation, the pattern indicates the preparation of the market participants to set a new low after consolidation and contraction within a triangle.

Once the horizontal support is broken, bearish continuation follows.

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Comments

Brilliant! Simple and informative. Thank you!
200 coins
+4 Reply
usefull good site
+4 Reply
give good calls
+3 Reply
Confusing a bit . Doesn’t say direction of movement
+3 Reply
@Traderwell hey trader well. There are different directions that support whether it should be a bullish or bearish breakout about to occur. With continuation patterns the resistance is always horizontal in contrast to the support trendline in which the closer it goes on it carries the buyers hence breaking the resistance and the price for the base to go up...mean while if the horizontal line is situated at the bottom, and the trendline is situated up in a slope direction it gives the sellers more strength therefore strengthening the quote price as the trend will break for the bearish trend. I hope you've understood. I don't mind repeating again 😊
Reply
Do you trade triangle patterns?
+3 Reply
isnt it about the direction price breaks out of triangle , rather than shape of triangle itself
+2 Reply