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Since 2014, my markets approach is to spot trading
opportunities based solely on the development of
CLASSICAL CHART PATTERNS
🤝Let’s learn and grow together 🤝
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Hello Traders ✌
I want to show you this Triangle because, didactically, it is a good one. Four main pivot points perfectly identified in what seems to be a compact consolidation after a strong downward move but:
• if we project the two boundary lines until they merge into the triangle apex, we will see that the possible breakout would take place at around 43% of the pattern when the best area is around 75% (60%-80% usually). This last rule is not as important as in the past. Nowadays this principle is something to firmly consider when the breakout is too close to the triangle apex rather than when it happens too early but it is still something to know and to be aware of. This is much more true when we are talking about a reversal pattern.
• I have seen too many times situations like this where prices are well below the 200 days EMA and a breakout, from what you expect to be a continuation pattern, occurs on the opposite side just to crash against the EMA and then pull back. In this case, the breakout area is exactly around the EMA and so it will be much more difficult, if not impossible, to trust it.
For these reasons, if this Triangle had broken on the downside, I would have felt much more comfortable with it. Of course, it can work out well even on the upside, but it is not something I want to be involved anymore.
🔎🔎🔎 ALWAYS REMEBER
"A pattern IS NOT a Pattern until the breakout is completed. Before that moment it is just a bunch of colorful candlesticks on a chart of your watchlist"
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⚠ DISCLAIMER ⚠
The content is The Art Of Charting's personal opinion and it is posted purely for educational purpose and therefore it must not be taken as a direct or indirect investing recommendations or advices. Any action taken upon these information is at your own risk.
════════════════════════════════
Since 2014, my markets approach is to spot trading
opportunities based solely on the development of
CLASSICAL CHART PATTERNS
🤝Let’s learn and grow together 🤝
═════════════════════════════════
Hello Traders ✌
I want to show you this Triangle because, didactically, it is a good one. Four main pivot points perfectly identified in what seems to be a compact consolidation after a strong downward move but:
• if we project the two boundary lines until they merge into the triangle apex, we will see that the possible breakout would take place at around 43% of the pattern when the best area is around 75% (60%-80% usually). This last rule is not as important as in the past. Nowadays this principle is something to firmly consider when the breakout is too close to the triangle apex rather than when it happens too early but it is still something to know and to be aware of. This is much more true when we are talking about a reversal pattern.
• I have seen too many times situations like this where prices are well below the 200 days EMA and a breakout, from what you expect to be a continuation pattern, occurs on the opposite side just to crash against the EMA and then pull back. In this case, the breakout area is exactly around the EMA and so it will be much more difficult, if not impossible, to trust it.
For these reasons, if this Triangle had broken on the downside, I would have felt much more comfortable with it. Of course, it can work out well even on the upside, but it is not something I want to be involved anymore.
- Pattern Class: 🌕🌕🌑🌑🌑
- Target area: 119.00
- Breakout area above: 112.00
🔎🔎🔎 ALWAYS REMEBER
"A pattern IS NOT a Pattern until the breakout is completed. Before that moment it is just a bunch of colorful candlesticks on a chart of your watchlist"
═════════════════════════════════
⚠ DISCLAIMER ⚠
The content is The Art Of Charting's personal opinion and it is posted purely for educational purpose and therefore it must not be taken as a direct or indirect investing recommendations or advices. Any action taken upon these information is at your own risk.
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