Ascending Triangles are a popular chart pattern, often traded by traders as a bullish continuation pattern. These patterns are easily recognizable due to the horizontal resistance level that price is trying to break through, while simultaneously forming a series of Higher Lows.
Price action within the pattern typically involves at least 5 swings, and can break the trend in either direction. However, breaks to the upside generally have a higher chance of success. The build-up of bullish pressure represented by the higher lows moving into the horizontal resistance level often results in a breakout when the pattern is around 60% complete.
Key features of these patterns include an aggressive entry at the third touch of the rising trend line, with a stop below the second trend line touch. A conservative entry would be at the BCR (Breakout Candle Close) of the horizontal resistance, with a stop below the support level/market structure.
While trading these patterns as breakouts can be a higher-risk entry, many traders are very successful at this style of trading.
The projected target, or Measured Move, would be the length of the move coming into the pattern.
