Triangle pattern
A triangle pattern forms when a 's price consolidates between two converging , narrowing its over time as it builds toward a breakout in one direction or the other. Triangles are among the most common continuation and reversal patterns in , and they come in three main varieties depending on the shape of the two converging lines.
An ascending triangle has a flat, horizontal resistance line at the top and a rising support line at the bottom, showing that buyers are willing to pay progressively higher prices on each dip while sellers keep capping the at roughly the same level. It is generally considered a bullish pattern, since the rising floor suggests demand is gradually overpowering supply, and it typically resolves with a breakout above the flat resistance line. A descending triangle is the mirror image, with a flat support line at the bottom and a falling resistance line at the top, generally considered bearish, since sellers are accepting progressively lower prices while buyers keep failing to defend the same floor. A symmetrical triangle has both a falling resistance line and a rising support line converging toward each other, reflecting a standoff between buyers and sellers with no clear directional bias until the breakout occurs.
In all three cases, typically contracts as the triangle narrows, reflecting the temporary indecision in the market, and then expands sharply on the eventual breakout, which traders often treat as confirmation that the pattern has resolved. Because a symmetrical triangle in particular gives no directional signal on its own, traders generally wait for a decisive, high-volume break of one of the before treating the breakout as valid, since a triangle can sometimes produce a false break in one direction before the real move develops in the other.