In this video, we’ll start with the ascending triangle, which is, of course, a bullish pattern when spotted during an uptrend.

Remember how I said in the previous video that the points can help you determine your type of formation?

Well, in the ascending triangle, the upper line is flat or horizontal if you wish, while the lower line is ascending.

Notice how point 4 is higher than point 2 and point 6 is higher than point 4 on the ascending line, while points 1, 3, and 5 form the horizontal line.

On the other hand, in a descending triangle, the upper line is descending while the lower line remains flat or horizontal. This continuation pattern typically appears during a downtrend.

So, in this case, points 1, 3, and 5 form the horizontal line, while points 2, 4, and 6 indicate consecutively lower prices on the descending line.

Last, but not least, there is one more pattern that some chartists like to identify as a fourth triangle – it is called the broadening formation. It’s a very rare price pattern that looks like a triangle turned backward.

So, while the previously mentioned triangles all have the base on the left side and show converging trend lines meeting at the apex on the right, this one has the apex on the left and trendlines that diverge towards an eventual base on the right side.

The broadening formation is considered a reversal pattern that generally appears at the end of a major bull market.