The ascending triangle is a bullish continuation chart pattern. The figure is formed by two converging lines.
The first straight line is a bullish slant providing support, also called the “ascending triangle support line”.
The second line is a horizontal resistance, also known as the “ascending triangle resistance line”.
The ascending triangle is confirmed / valid if it has oscillation between the two lines.
The ascending triangle pattern is considered valid if the price touches at least 3 times the support line and 2 times the resistance line (or at least 2 times the support line and 3 times the resistance line).
The price objective of an ascending triangle is determined by the height of the base of the triangle which is carried over to the breakout point (above the resistance). Another technique is to draw a parallel to the line of support of the ascending triangle from the first contact with the resistance.
Notes and Statistics: #
- The exit is most often done at 2/3 of the triangle. This is the output level that offers the best performance.
- The target price of the ascending triangle is generally reached before the point of the triangle.
- Avoid taking a position if the break / exit occurs before 2/3 of the triangle.
- Supporting pullbacks on the resistance line of the ascending triangle are detrimental to performance.
- In 62% of cases, the exit is bullish.
- In 75% of cases, the ascending triangle is a continuation figure.
- In 75% of cases, the price target of the triangle is reached when resistance is broken on the upside.
- In 60% of the cases, the price carries out after exit a pullback in support on the line of resistance of the triangle.
- In 25% of cases, the price shows false line breaks, or false triangle exits.