If you have ever wanted to make money in the US stock market, you are reading the right article.
In this article I will go deep and explore the simple but stunning and profitable ascending triangle chart pattern that can help you profit in the US stock market week in week out.
Before I reveal the chart pattern to you I need to tell you that our approach to the stock market is through technical analysis.
When you use technical analysis you:
Eliminate all noises from news and gossips and rumours
Focus solely on the charts with a laser focus on our special chart pattern
Only trade the stock or the index when the chart pattern appears
Follow all the rules of technical analysis and setup before making any trades
By the time you finish reading this article you will be able to spot a stock that is ripe for a good trade. You will also learn how to spot the trend that is conducive for this setup.
Perhaps it may take you a few times to really read and understand the material in this blog post but sooner or later, you will be able to understand and master this pattern.
Here is a bird's eye view of what you will learn in your journey towards profitable trading:
The Ability To Focus Only On One Chart Pattern Often Produce The Best Results
How To Enter The Ascending Triangle And How To Put A Stop Loss
Additional Factors That Significantly Improve The Ascending Triangle As Bullish Continuation Pattern
Trading The Ascending Triangle Chart Pattern As A Bullish Reversal Chart Pattern
What Type Of Stocks Works Best For The Ascending Triangle Chart Pattern
How To Let Your Profits Run And Take Profits Off The Table Wisely
The Ability To Focus Only On One Chart Pattern Often Produce The Best Results
There are dozens of chart patterns for the trader to learn. If you go through books and trading websites, there will always be more than enough chart patterns for you to devour.
My question to you is this...
Do you really really need to learn all of them by heart?
After all, it only takes one chart pattern for you to make money in the stock market. It also allows you to save time. All you need to do each day is to look for one chart pattern and determine whether the chart pattern appears in any stock chart.
If it appears in a stock like AAPL. Good, we have a trade there. If it appears in the S&P 500, good, we have a trade there too.
If it does not appear in any stock or index for the week, our work is done and we can take a rest and don't trade for the week.
One chart pattern...learn and master and know the pattern in and out and you will be above all the other traders when it comes to that chart pattern
You will know:
Where the chart pattern works best
Whether the pattern work in a particular environment
Whether the pattern works better in a particular type of industry, sector or type of stocks
Whether it will give you a good risk to reward at the particular atmosphere
When the chart pattern does not work (believe me, when you know the chart pattern in and out, you will have a gut feeling whether it will work or not)
Be the best among the best with regards to that particular chart pattern
Introducing The Amazing Ascending Triangle Chart Pattern
For those of you are familiar with the ascending triangle chart pattern, I promise you that you will learn something that you have never known before about this chart pattern.
Read through the whole article and read it twice more.
The reason is I want you to have a solid foundation in trading. If you skip here and there you probably won't really be able to fully grasp why some traders make money and why some traders lose money.
Alright, now that I have got it out, let me introduce to you the amazing stunning great ascending triangle chart pattern.
Alright, this is what an ascending triangle looks like.
Pretty simple and straightforward right. Yes it is simple when you look at the drawing on the left.
However, I do realize for the beginner it may be quite difficult to spot an ascending triangle in real charts.
With practice you can learn to spot them
If you are new, it is always a good idea to read the writings and annotations of more experienced traders or chartist.
The chart above shows how an ascending triangle appeared in the stock chart of Apple. The idea behind the pattern is, once the stock breaks out of the top of the ascending triangle, we treat it as a bullish phenomenon.
When it turns bullish, we want to buy the stock and ride it higher.
Imagine if you have taken a trade in the stock above the moment when it broke out of the top of the ascending triangle.
Wow...
Look how far Apple's stock ran. You would have made a killing with minimal risk and great rewards. Meaning your reward to risk is very very good. Risking 1 to make 2,3,4 or even 5 times is a good idea for any person.
Aren't you glad you stumble upon this page. Yes my goal is to help you to become a better trader, a better stock analyser, a better person and a better participant of the stock market.
The Ascending Triangle As A Continuation Pattern
In the first chart example that I have given you above, we witnessed how the stock of Apple stop dropping after the appearance of the ascending triangle.
What happened was the ascending triangle acted as a bullish reversal pattern. If you read the classic textbooks or most websites, they will show you that the ascending triangle is used as a bullish continuation pattern.
In fact, the ascending triangle can act as a:
Bullish reversal chart pattern
Bullish continuation chart pattern
I think this will be an uncommon knowledge for many many traders and many readers of this article. But I will teach you that the ascending triangle is so powerful if you know how to use it, you can treat it as a bullish reversal chart pattern and a bullish continuation chart pattern.
Alright, let's take a look at an example of an ascending triangle that acted as a continuation pattern. Back in early 2022, AAPL bottomed. It then rose higher but encountered some resistance and drifted sideways.
The sideways drifting eventually formed an ascending triangle chart pattern. The moment an experienced trader sees this pattern happening, he or she would already know that this pattern is a very very potent and high quality one.
In a short while I will explain why this setup was a high quality one.
But first I want you to take note of the annotation above where I wrote lower low and higher low.
One of the reasons why the ascending triangle chart pattern works so well is because there is a lower low and a higher low.
Why you may ask?
If you asked why? You are on your way to become a better stock trader and a better stock analyser and also on the way to become a better person as a whole.
Asking questions is good.
The reason why a stock makes a higher low is because there is STRENGTH in the stock.
If the stock is not making a higher low, then it is WEAK.
You want to get into a stock that is showing strength not weakness.
The top of the ascending triangle is the same. But the lows are improving with the second low being higher showing improving strength in the stock.
How To Enter The Ascending Triangle And How To Put A Stop Loss
Some of you who are smart will definitely know how to enter the stock already. For newbies and beginners, how do you enter into a trade using the ascending trianlge chart pattern?
The simple answer is this:
Enter the stock the moment it breaks out of the top of the chart pattern
This is a classic buy the breakout. When you enter into an ascending triangle trade, you are actually buying the breakout.
Some traders are known as breakout traders.
You buy the breakout in the stock because you belief and are convinced that the stock will be moving higher.
Why not?
This ascending triangle chart pattern is a valid chart pattern and the fact that it appeared in the charts show that there is a bullish bias.
So you buy the breakout because you have a bullish bias.
Just take a look at the stock chart of AAPL above. If you have bought the breakout in this stock, what would have happened?
Yes, you would be participating in a very nice run up. You will be participating in a nice bullish uptrend and you will also be increasing the profits and size of your trading account.
Of course, not all trades are going to be textbook perfect.
Sometimes the best patterns may just result in bad trades. It could be that the market sentiment is not good or it could simply be that you are not experienced enough and don't do your homework properly.
No matter what the reason, it is always a good idea to prepare for the worst case scenario.
You must allocate not more than 10% of your capital in a single trade and then you MUST have a stop loss. That is proper trade management.
Here is how you put a stop loss to secure yourself from financial ruin:
Put a stop loss one or two points below the ascending triancle chart pattern
Put a stop loss below the entire ascending triangle chart pattern
Put a stop loss below the higher low
Additional Factors That Significantly Improve The Ascending Triangle As Bullish Continuation Pattern
Are there any factors you may ask, that really improve the performance of the ascending triangle?
Yes definitely!
If you are asking this question, then you are on your way to become a very good trader.
You see, whether a trade is going to work out well or not depends on this little secret:
Confluence of technical concepts.
Whether a trade is going to be a high probability trade depends on whether there are many confluence of technical concepts
In other words, if you want a high probability trade, you need to have many many things that support your ascending triangle chart pattern.
While there can be many technical factors, here are some of them for you to consider:
Is the stock already in a daily uptrend?
Is the stock sitting at a flat 200 MA?
Is there a lot of resistance overhead?
Is the stock above the 20 MA?
Is the stock above the 50 MA?
Is the stock in a weekly uptrend?
Does the stock have a buy signal in the weekly charts?
Does the stock have a buy signal in higher time frames?
Is there a buy signal in the lower time frame charts?
I can't go into detail into every single one of the above factors. But if you are a very experienced technical analyst or trader you will understand all of the above.
Which is why it is not easy at all for a trader to be successful. Let me show you again the chart that I showed you above.
This is the second time we will be looking at this chart. But this time I will guide you to see the charts in another way. I have added something extra which is the measured move target but everything else is still the same compared to the previous chart.
Simple as it looks, in the eyes of a very experienced trader or technical analyst, the chart above tells a very very detailed picture of success. If only you know where to look.
This stock indeed exhibits the daily ascending triangle chart pattern. You know this because there is a flat top and a lower low with a higher low. When you connect the lines, you get an ascending triangle which you can buy when the stock breaks out above the top of the chart pattern.
Notice how this stock has gone from a stage 4 downtrend to a stage 1 basing and is now in the beginnings of a stage 2 uptrend. If you want to learn about the market stages, take a read of the 4 Stages Of The Stock Market article. Basically, you want to buy a stock only when it is in a stage 2 uptrend otherwise you will tend to lose money in the stock market.
This stock recently had a bullish 20 MA cross above 50 MA. When the faster moving averages crosses above the slower moving averages, this is a signal that a bullish situation is arising. This bullish cross appeared slightly before the ascending triangle chart pattern appear.
When the stock breaksout, the stock was trading above the 20 MA and 50 MA. This is the sign of a bullish trend.
Notice also how the 20 MA and 50 MA were rising when the stock broke out. This shows us that the trend is going to be up.
The stock was hugging or trading at the flat 200 day moving average. The 200 MA is like a magnet and leash. When a stock trades near the 200 MA, it will eventually snap away and move away from the 200 MA. So this gives the trader an inkling that the stock will move away a lot from the 200 MA. The only question left is whether it will move away bullishly or bearishly.
Prior to the formation of the ascending triangle chart pattern, the stock had a smooth rise. With this, we can take an advance technique called the "Measured Move" and project the height of the move from the base of the ascending triangle upwards to get an initial target.
You see, with all the above combination of technical concepts, the trader who looks at this ascending triangle will know a few things:
The stock has an inintial target
The stock has a lot of room to move up
This stock is in an uptrend with endless possibility
With this in mind, the trader knows that if he or she enters this stock there is a good likelihood that the trade will be successful, an initial target will be met and the stock could move higher than the initial target because we are just in the beginnings of an uptrend in the stock.
That is how you find a high probability winning trade that has good reward to risk.
Trading The Ascending Triangle Chart Pattern As A Bullish Reversal Chart Pattern
Now that we have dealt with the ascending triangle chart pattern as a bullish continuation pattern, we want to look at the ascending triangle as a bullish reversal chart pattern.
I really really like the ascending triangle because of its versatility.
You may have only learned about this chart pattern as a bullish continuation pattern, but I have noticed time and again how this chart pattern acted as a bullish reversal chart pattern.
Let's take a look at the chart of Arch Capital above. This is a daily chart and in this chart alone, we can see how the ascending triangle acted as a bullish reversal chart pattern not only once but twice.
It is like being able to see a double rainbow rather than one rainbow.
I can tell you there are many times I have observed how one chart pattern appeared many times in a stock.
In both times, the stock had a correction. But when the ascending triangle chart pattern appeared, the stock went back up. This provided traders who were observant an opportunity to trade the stock from a swing trading point of view.
The stock was already in an uptrend making higher highs and higher lows. If you are able to spot a stock that is in an uptrend, then there are lots of opportunity for you to profit from the stock.
To be able to spot a stock making an uptrend is not easy. It takes some time and practice but it will be worth it in the end.
One way to spot whether the stock is in an uptrend is to look at whether the stock chart is moving from lower left to upper right. If you see a stock like that, then it is in an uptrend.
When a stock corrects in an uptrend and forms an ascending triangle, odds are it will give you a nice swing trade to the upside
Additional Factors That Significantly Improve The Ascending Triangle As A Bullish Reversal Chart Pattern
Just like the bullish continuation pattern, there are many technical concepts that may help to improve the ascending triangle as a bullish reversal chart pattern.
The ability to find a high probability trade comes with experience. It is not easy but with experience you will definitely be able to do so.
The keyword here is "Bullish Reversal".
If you are looking for a bullish reversal you want to find technical concepts where there is a high probability of bullish reversal. Places and scenario such as:
Stock is at major or minor support
Stock is at long term support
Technical indicators are oversold
Technical indicators show a buy signal
Stock is resting at important moving averages
Stock is correcting to an important Fibonacci Retracement level
The higher time frames have bullish candlesticks appearing
The lower time frames is already starting a new uptrend
There are signs of bullishness in the lower time frames
The above is not an exhaustive scenario but it does give you an idea what you should put in your list. As you trading knowledge and experience grows you want to put in more and more checklist of a perfect trade.
Therefore, when you see the stock meeting many checklist, you know the odds of the trade performing very well is high.
Let's take a look again at the 60 min chart of AAPL which I showed you earlier. I have added something into the chart, I wonder if you can spot the difference between the chart above and the first chart I showed you.
If you did then you are indeed getting good at it.
There is indeed a 60 min ascending triangle that appeared. The basic instinct for you now would be to just buy the stock when it breaks out of the top of the 60 min ascending triangle.
Hold on....
This is a textbook example and I do not want you to think that it is easy.
Remember what I taught you.
Always look for convergence of technical concepts. The more clues and proofs you find, the higher the probability of success of the trade.
Just by looking at the 60 min chart, here are some additional reasons why the stock is going to do well:
The stock went from a 60 min stage 4 downtrend, formed a stage 1 base as the ascending triangle formed and is about to start a stage 2 uptrend in the 60 min chart
The stock broke above a downtrend line (blue line) and this indicated strength in the stock and a willingness to change trend from bearish downtrend to bullish uptrend
The stock was previously trading below its 60 min 20 MA and 50 MA and this was bearish. But during the breakout, the stock was already trading above the 60 min 20 MA and 50 MA. This indicated to the astute trader that the stock will most likely be starting a new uptrend
Previously, the slower MA (50 MA) was above the faster MA (20 MA). This was a bearish trend. Notice how the stock slowly transitioned from this and the faster MA (20 MA) eventually cross back above the slower MA (50 MA). I call it a bullish cross.
That's a lot to grapple I know. But I bet you never ever thought you could read so much from such a simple chart. And I haven't even put in other technical indicators besides the moving averages into the 60 min chart.
Wait we are not done yet!
Let's have a bit more confirmation from the higher time frames.
If you are trading the ascending triangle from a 60 min chart point of view you should find confirmation from a higher time frame. In this case, it would be the daily time frame.
This is an advanced discipline in technical analysis called Multiple Time Frame Analysis which I will teach in my soon to come "How To Analyze The Stock Market With Accuracy" course.
It is too much to talk about it here in this article so I need to devote an entire chapter on it in the course.
For now just try to understand multiple time frame analysis through this example.
This chart is the daily chart of AAPL.
AAPL is the ticker symbol for Apple's stock and you can easily find a free chart with limited indicators using Investing.com
A side note, I am a contributor to this website where occasionally I will write an opinion and analysis about stocks and the stock market.
In the chart above, I have put a few indicators. First are the moving averages. I have the 20 MA, the 50 MA and also the 200 MA.
Then I have the MACD Histogram with its lines, the stochastics indicator and the Bollinger Bands.
That's the max I think what the FREE version of Investing.com will give you. But for swing traders and position traders, it is more than enough for you to use.
I do not recommend putting more than 4 types of indicatos as you will end up with analysis paralysis. A good trader can make money with just 3 indicators. Less is more my friends.
Now let's dissect what happened in the daily chart of AAPL. The arrows that I point out in the daily chart of AAPL above corresponds to the 60 min chart of AAPL where the 60 min ascending triangle took place.
The first thing to take note is the rising 200 day moving average. It is the faint yellow line. If you look carefully you will see a yellow line in the chart. The 60 min ascending triangle happened near the 200 day moving average. The 200 MA can act as a support. Sometimes a stock can stop dropping the moment they reach the 200 MA but sometimes they can slash through the 200 MA by a bit before going back up. So the 200 MA gives us a reason to look for a bullish reversal.
The second thing to take note is the stock was at the lower half of the bollinger bands. When the stock prices reaches the upper or lower band of the bollinger bands, they tend to reverse back up. This gives the trader another level of confidence that the stock is about to have a bullish reversal back up.
The stochastics are also quite oversold and soon it gave a buy signal. This is another layer of support for the bullish reversal that a trader anticipates in the stock.
If you look at the MACD Histogram carefully you can also see that the MACD Histogram is shortening. This tells us that bearish momentum is slowing down and perhaps a bullish reversal is about to happen.
While we do not have the time to go into each indicator and learn how to interpret its message, I think it is clear for you right now that you need many technical concepts to converge to make a trade successful.
Perhaps you should take some time to read about the moving averages, the stochastics, the Bollinger Bands and the MACD. Once you know how to use and intepret them come back and read this article again.
You will be surprised at how easy it is to combine all these indicators to come to a conclusion.
Let me give you another tip on how to find the perfect combination.
The chart above is the daily chart of AAPL but I overlaid it with the Fibonacci Retracement. Notice how the stock stop dropping near the 38% retracement level?
That is also where the 60 min ascending triangle appeared.
I won't bore you into the Fibonacci Retracement theory but what happens is stocks tend to stop dropping at the 38% level and the 50% level.
We got the 38% retracement level by drawing the Fibonacci tool from the lows near early 2023 to the recent highs. Most charting software would have a Fibonacci tool where you can draw the line and it will automatically calculate the levels of the Fibonacci Retracement levels.
I think by now for beginners this will be a really deep and tough lesson but hey nobody said that correct application of technical concepts are easy.
It will take some time for you to get familiar with all these. But trust me they will be very worth it.
You Can Trade The Ascending Triangle In Multiple Time Frames. Weekly Chart / Daily Chart / 60 Min Chart / 5 Min Chart
I think by now you will have realized that you can actually trade the ascending triangle chart pattern in so many time frames.
You can find this chart pattern appearing in different time frames such as:
The 5 min chart
The 15 min chart
The 1 hour chart
The daily chart
The weekly chart
The monthly chart
Each time frame will have its own set of challenges and nuances that you will need to learn and master. If you opt for the lower time frames such as the 5 min or 15 min chart, you will be walking into the realm of day trading.
Day trading takes a lot of discipline and concentration. If you do not have the time to do so, it will be better for you to opt for the longer time frame such as the 60 min chart or the daily chart and even the weekly chart.
You must try out the different time frames and observe many ascending triangles in that time frame.
If you have a day job then I advise you to do the daily chart and weekly chart. That way you can still trade and stick to your day job. Plus, it is less stressful while you are learning to earn in the stock market.
Isn't it amazing?
You learn one chart pattern and now you can trade in all time frames.
That is what trading is all about. Just be a master at one chart pattern and you will be able to make money in any time frame.
Just pick the best time frame for you and master the chart pattern in that particular time frame. To make money in the stock market you do not need to trade all the time.
All you need to do is to wait for the setup to appear in the time frame you choose.
What Type Of Stocks Works Best For The Ascending Triangle Chart Pattern
Is there any type of stocks that works better?
Well, what I have observed for this chart pattern is it does not matter what type of stocks or sector or industry the stock is in.
The important thing for you is to choose a stock that has enough trading volume each day. Put a minimum trading volume of 500,000 a day.
The reason is chart patterns are made by human emotions and human actions. You want to trade in a stock that has enough volume and not being manipulated by a handfull of people.
Because chart patterns draw a picture of the greed and fear in humans, you want it to be a collective huge amount of people and not the hand of a few.
That way when the ascending triangle chart pattern appears, you know that it is the general public that is reacting. So the odds of success is greater.
Having said that, I see this chart pattern appear a lot in the S&P 500 stocks and also the Nasdaq Composite stocks.
There are enough stocks for you to trade there and the average daily volume are usually huge in these stocks. So try the stocks there first before anywhere else.
How To Set An Initial Target For The Ascending Triangle
One of the things that plague the new trader or even the experienced trader is how do you even set an initial target for a chart pattern?
Have you ever been in a situation where you put on a trade, see the trade become extremely profitable only to see it reverse and wipe out most of your profits.
Then the position goes to breakeven and eventually it becomes negative.
If your answer to that is yes I know how you feel.
Every participant of the stock market has gone through that cycle at least once. Which is why it is very important that you learn where you should take some profits off the table.
Thankfully, the ascending triangle chart pattern comes with an initial target.
What a wonderful pattern isn't it?
This is how you get the target.
Once you have recognize and drawn the ascending triangle chart pattern on your chart, take the height of the pattern.
Project the height of the pattern upwards from the breakout area. That will be the 1st target area.
What do you do when the stock reaches the 1st target?
Well you can sell it all and have a good nights sleep.
But if you have followed and read what I teach you in this article you will be leaving quite a lot on the table since the stocks that I teach you to choose will have a lot more room to run.
Well, we never know how high the stock can run. But a good strategy would be to take 1/3 or 1/2 of your position off the table when the initial target is met
Then raise your stop loss to a breakeven point (your purchase price) and you will have a free trade.
In the next section, I will teach you how to let your profits run.
How To Let Your Profits Run And Take Profits Off The Table Wisely
We will now deal with the issue of when to let our profits run.
I have already taught you to take some profits off the table when your 1st initial target is met. But how do you know when you should really be a bit patient and let your profits run?
This takes a bit of experience but I will tell you a little secret.
You should let your profits run if the ascending triangle appears at the start of an uptrend
You should let your profits run if the ascending triangle appears at the middle of an uptrend
You should be quick to take profits off the table if the ascending triangle appears late in an uptrend
To determine whether a stock is just beginning an uptrend you need to be familiar with the 4 Stages Of The Stock Market.
This is something I hope to teach you in more depth in my upcoming "How To Analyze The Stock Market With Accuracy" course.
In reality you want to be early in a stock or at least buy in the middle right?
It makes no sense to buy a stock when the uptrend is near the end.
So if you see a stock making an ascending triangle chart pattern at a very long tired uptrend then you should be a bit careful.
Take the example above of AJG's stock chart. The stock has been in an uptrend for quite sometime. It is already in a nice stage 2 uptrend for a long time.
All of a sudden, you see an ascending triangle appear.
Can you still take the trade?
Well of course...
But with what I have taught you about late stage buying, you will be more ready to take profits off the table.
You should enter the stock, take 2/3 profits off the table and keep only 1/3 left while raising the stop loss to your breakeven purchase price so you can have a free trade.
In the chart above, the stock did met its 1st target but it has gone down since. I'm not even sure if it can go back up again.
We should be realistic in the stock market. If you are late to the party, always leave before it ends. Don't overstay your welcome where you will need to clean up the mess later.
Ok....now what about if you entered really early or in the middle of the party...
Let's go back to some early charts I showed you.
If you entered into AIZ in the daily chart above, you will actually be entering the stock when it just started a new uptrend.
If you are early in the trend, try to be a bit more patient and ride the trend higher. When your 1st target is met, take 1/3 profits off the table.
Then you could use one of the moving averages to know when you should sell the stock. I prefer to use the rising 50 MA in a stock that has just started an uptrend.
See how the stock did not drop below the 50 MA (blue line) in the chart above?
A stock that is strong and just started a new uptrend will rarely drop below the rising 50 MA. It can drop below the rising 20 MA now and then but trust me it rarely drops below the rising 50 MA unless you are dealing with the end stage of the uptrend.
Right now, we should still be holding onto this stock with our stop loss raised to breakeven. Sometimes you can even end up holding a stock that goes up 200%-500%.
Never doubt the power of coming in early to the party.
This I'm talking about daily charts and longer time frames. Things might need a different approach in lower time frames.
Let me now show you another chart I showed you earlier. This will be the 60 min chart of AAPL.
In this case if you have entered the stock when it broke out of the ascending triangle pattern, you will be participating in the beginnings of a new 60 min uptrend.
With 60 min charts, you might not want to take 1/3 off the table once your initial target is met. That's because they can go way higher in terms of rewards to risks.
Use the rising 50 MA instead as a guide.
A powerful winning trade will never drop below the 60 min 50 MA while it is on fire. Just ride it higher and sell 1/2 of the stock when it drops below the 60 min 50 MA. Then raise your stop loss to breakeven and see what happens.
Slowly sell out your remaining 1/2 position.
Told you different time frames have different nuances. You need experience my friend to be a very very good trader.
If you don't want to learn from your own bad experiences at least learn from the experiences of others.
Aggressive Stop Loss For Aggressive Traders
Is there such a thing as an aggressive stop loss or non aggressive stop loss?
I believe there is...
If you put a stop loss very near your entry point then you are more aggressive. The upside is you get to have a bigger reward to risk ratio if your trade works out.
The downside of course is you will be stopped out earlier.
But with the ascending triangle pattern, you can have a more aggressive stop loss by putting your stop loss at the higher low.
Doesn't matter if you get stopped out once in a while. You want to get the data from at least 100 trades.
Because in the short term, stop loss being hit are noises. But in the long term and with many trades you will see the power of the stop loss in action.
Your wins will always be bigger and more frequent than your losses. That's how you make money in the stock market.
How To Scan And Find The Ascending Triangle Chart Pattern
Is there a short cut where you can automatically find the ascending triangle chart pattern? I wish we can have these patterns pop up on our screen the moment it appears.
But unfortunately you still need to do some eye ball filtering for yourself.
You can go to www.chartmill.com to scan for the pattern. You get some free trials but after that you need to buy credits or a subscription.
Or a great free screener is www.finviz.com. I really love this site.
This is the Finviz chart pattern screener. Go to screener and click the technical section and then pattern and click on Triangle Ascending or its variations. Try also to get stocks that have 500,000 volume a day.
I screenshot the results of the screener above and you can see ALXO. Spot the acsending triangle?
Its not perfect but at least you have somewhere to start.
But here is the best part...
MANUALLY go through the S&P 100 and Nasdaq 100
If you wanna be good at something, learn to specialize my friend. Why not just go through the S&P 100 and Nasdaq 100.
You can use finviz to go through the S&P 100 or S&P 500 easily. Many other sites or even your charting software has a pre built list of the Nasdaq 100.
Whatever works for you. Just go through the charts of 100-200 stocks every week and see if the pattern appears.
If there is a pattern, then trade it. If there is none, just rest. Another boat will soon come along.
Why Does The Ascending Triangle Chart Pattern Work So Well?
If you have read this far, I just want to say a big congratulations in investing in your own technical / trading / investing knowledge.
I just want to leave you with this thought...
"The ascending triangle chart pattern works so well because this pattern has an in built BULLISH bias in it."
I want you to take a look again at the drawing of the ascending triangle again.
This chart pattern is formed when a stock keeps testing an area of resistance making the same highs but strangely enough, it keeps making higher lows.
It's like its telling us...
"While I may not go higher, I'm raising the floor...soon I will explode higher".
You get what I mean.
Things are squeezing to go higher.
Now that you know the ascending triangle chart pattern, why not try trading it?
Let me know by commenting below whether you prefer to use the ascending triangle as a bullish continuation pattern or a bullish reversal pattern.
Did I miss anything or should I have included something in this post? Please comment and let me know your thoughts.