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Technical analysis figure: Triangle. How is it formed on the chart, what types of triangles exist and how to use them in trading?
The formation of a forex triangle can often be seen on different timeframes and if used in trading forex strategies or binary options strategies in conjunction with a triangle, then the picture of what is happening will be seen even more clearly.
There are 3 types of triangles:
- ascending triangle
- Descending Triangle
— symmetrical triangle
They can be easily seen on the charts, the triangle is a frequent occurrence, so you should look closely at it.
When a triangle is formed, everything ends up with the price breaking in one direction, but in which one — it depends on different conditions.
I recommend using strategies, and this figure is easy to take into account when trading, and if a triangle appears, then the market is narrowing in a narrow angle.
The triangle shape is almost the same as figure wedge, but there are a number of features, if you look closely, then the triangle has a different construction, but the principle of narrowing in a narrow angle is the same.
Read also - Shape: Wedge
Here are examples of existing triangles:
In an ascending triangle, as a rule, the price breaks up the resistance line, you can enter from a rollback using this strategy or place a pending order for 2 points with a take profit of 10-15 points, it usually works.
In a descending triangle, as a rule, the price breaks down the support line, therefore, we act in the same way as with an uptrend.
With a symmetrical triangle it is already more difficult, here the price can hit both up and down.
Therefore, you can place 2 opposite pending orders by drawing lines to see the boundaries of the triangle. Or wait where the price will go, and then enter from a rollback, it’s more reliable.