Triangles are one of the most common patterns in Technical Analysis, divided into four types: descending triangle, ascending triangle, symmetrical triangle, and expanding triangle. Each pattern implies different market sentiment, and the key is to learn when to enter at the right moment.
Descending Triangle = Bearish Signal
What it looks like: The upper line is a descending resistance line, and the lower line is a horizontal support line.
How to trade: When the price breaks below the support line + the trading volume significantly increases, it indicates that selling pressure has really come. You can consider opening a short position. Conversely, a break with insufficient trading volume is often a false drop, which is likely to rebound and hit you back.
Where to set the stop loss: Place the stop loss above the nearest resistance line. Once the price rebounds to that level, it indicates that the pattern has failed, so withdraw quickly.
Rising Triangle = Bullish Signal
What it looks like: The line below is the rising support line, and the line above is the horizontal resistance line.
How to trade: The price has attempted to break through the upper resistance multiple times but has failed each time. However, each rebound is higher than the last.