OBEROIRLTY: Swing trade
Ascending Triangle Breakout
In Ascending triangle pattern the upper trendline is flat, while the lower line is rising.
This pattern indicates that buyers are more aggressive than sellers. It is considered a bullish pattern and is usually resolved with a breakout to the upside. The pattern is completed on a decisive close above the upper line.
This breakout should see a sharp increase in volume.
The upper resistance line should act as support on subsequent dips after the breakout.
Ascending Triangle Measuring Technique
For the ascending triangle, traders can measure the distance from the start of the pattern, at the lowest point of the rising trendline to the flat support line. That same distance can be transposed, later on starting from the breakout point and ending at the potential take profit level.
The illustration above shows the distance from A to B can be transferred higher up, from C to D, in order to project a possible take profit level.
How to trade Ascending Triangle Pattern
After viewing a strong break above resistance, traders can enter a long position, setting a stop at the recent swing low and take profit target in line with the measuring technique.
Note- False breakouts are possible (traders need to manage risk accordingly)
My advice is to risk only 2% of your trading capital. Buy 30% of your position at CMP & if price respect levels of 676 then execute your 70% position.
The whole idea is to lose less money when you are wrong and to win more money when you are right.
Ascending Triangle Breakout
In Ascending triangle pattern the upper trendline is flat, while the lower line is rising.
This pattern indicates that buyers are more aggressive than sellers. It is considered a bullish pattern and is usually resolved with a breakout to the upside. The pattern is completed on a decisive close above the upper line.
This breakout should see a sharp increase in volume.
The upper resistance line should act as support on subsequent dips after the breakout.
Ascending Triangle Measuring Technique
For the ascending triangle, traders can measure the distance from the start of the pattern, at the lowest point of the rising trendline to the flat support line. That same distance can be transposed, later on starting from the breakout point and ending at the potential take profit level.
The illustration above shows the distance from A to B can be transferred higher up, from C to D, in order to project a possible take profit level.
How to trade Ascending Triangle Pattern
After viewing a strong break above resistance, traders can enter a long position, setting a stop at the recent swing low and take profit target in line with the measuring technique.
Note- False breakouts are possible (traders need to manage risk accordingly)
My advice is to risk only 2% of your trading capital. Buy 30% of your position at CMP & if price respect levels of 676 then execute your 70% position.
The whole idea is to lose less money when you are wrong and to win more money when you are right.