Ascending Triangle

Both the ascending and descending triangles, while looking very similar to the symmetrical triangle, are much more specific in their implications for the trend. The symmetrical triangle is neutral, and that cannot be said of the ascending or descending triangles.

The ascending triangle is definitely bullish, and that applies whenever it occurs. Usually it will be seen in an uptrend and is a continuation pattern, but sometimes it can be seen in a downtrend when it is a bottoming pattern, and may signal a reverse. Here’s the pattern again –

It’s basically showing that the buyers are being aggressive and bashing away on the resistance level until it fails at the breakout. That is why it would be unusual for it to break out to the downside.

The completion of the ascending triangle pattern is when the price closes on a breakout above the horizontal upper line. Again, the volume will provide confirmation of the strength, and you would expect it to increase on the breakout, particularly as this is an upward move. The price may retrace on light volume back to the upper line.

The easiest way to determine a minimum price target is to take the height of the pattern, shown by the vertical arrow at the start of the triangle, and transpose that to the breakout point. The size of the pattern is a good indication of the minimum distance that the price should move from it.

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