Definition
Triangle Pattern
A triangle is a consolidation pattern of converging trendlines — ascending, descending, or symmetrical — that precedes a breakout.
An ascending triangle has a flat top and rising lows (usually bullish), a descending triangle has a flat bottom and falling highs (usually bearish), and a symmetrical triangle has converging highs and lows that can break either way. The narrowing range reflects a building tension between buyers and sellers.
NSE traders watch triangles on Nifty, Bank Nifty, and stocks for the eventual breakout, entering in its direction with a target based on the triangle's widest height. Because triangles can give false breaks, confirmation by volume and a decisive close beyond the trendline is key.
Related terms
- Flag PatternA flag is a short continuation pattern where price consolidates in a small channel after a sharp move, before resuming it.
- BreakoutA breakout is when price moves decisively beyond a defined support, resistance, or pattern boundary, often starting a new move.
- TrendlineA trendline is a straight line connecting a series of highs or lows to visualise the direction and slope of a trend.
- ChannelA channel is a pair of parallel trendlines containing price between an upper resistance line and a lower support line.
Plain-English explainer from The Dispatch Investors Encyclopedia. General information, not financial advice.