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Ascending Triangle Chart Pattern


In continuance with Technical Triangles Chart Pattern covered in previous post, today we will be covering up ascending  triangle chart pattern.

Ascending Triangle:

In case of a ascending triangle formation, we will see the lower support line to be rising while the upper resistance line will be constant or at same levels. This pattern is bullish in nature and represents increasing buying power. The pattern is completed once the price breaks above the upper resistance line. The ideal entry points occurs when the price breaks out above upper resistance line. As the charts shows there is usually a pull back again towards the resistance line after breakout has occurred,this offers the technical analyst another good point to make an entry in the stock.

Targets are set by measuring the base of the triangle from the point of breakout as labelled in the diagram.

Following are some more examples of ascending triangle chart pattern:

So, the major points to remember for ascending triangle chart pattern:

1) In case of ascending triangle formation the support line will be rising and resistance line will be constant

2) The pattern is completed when the price breaks above the resistance line.

3) Targets are established by measuring the width of the base of the triangle from the point of breakout

4) After breakout has been occurred there can be a pull back again towards the point of breakout, this is an ideal entry point.

5) As technical analysis deals with probabilities there can be nothing which works all the time so it would be good to keep stop loss slightly below the point of breakout so that we can get stopped out at right time if things don't work as per our expectations.

For scanning out stocks for ascending triangle pattern check out this link

Also check: Best books for Traders/ Investors

Happy Learning
Multiplier Wealth

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