One of the best ways is technical indicators. It indicates what's the next turn will be and what's action you have to take. Into the so many technical indicators, Triangles are the most beneficial of them and contracting and expanding is both the key factor of it.
A contracting triangle is characterized by five different points or legs of a triangle which connects a to c and b to d trend line, and it will end in a common point in the future. It will show the volatility of the market trend.
There are some categories of the contracting triangle pattern which shows the different angles of triangle patterns.
HORIZONTAL CONTRACTING TRIANGLE PATTERN
This pattern is a similar triangle pattern in the contracting pattern. In this pattern, every wave is smaller than the previous one and that's why it's the contracting triangle.
The very definition of such a triangle is, therefore, a>b>c>d>e. The name of such a triangle comes from the fact that it is evolving on the horizontal and, starting from its beginning, the price will form a series of ups and downs around that level until eventually, they will break higher or lower.
IRREGULAR CONTRACTING TRIANGLE PATTERN
An irregular contracting triangle pattern is commonly similar to the a-c and b-d trend line points. But there is the difference that a wave is smaller than the b wave.
The patterns will show only when wave c is completed. Both evolve similarly to a horizontal triangle. While a horizontal triangle is pretty common, an irregular contracting triangle pattern appears in most cases in the forex market.
Well, it's quite a smart move, this pattern shows the fake side that attracts traders from the wrong side.
RUNNING CONTRACTING TRIANGLE PATTERN
This pattern has a special fact that its endpoint will be above (while the market is bullish) or below (when the market is bearish).
Overall, this triangle pattern means it will run until the triangle is broken and the b-d trend line is the one that holds the key for any entry. In this triangle, the d wave is bigger than the c wave like the b wave is bigger than a wave.
In running the contracting triangle pattern, you can find the b wave is the longest one of all waves and the d wave is the shortest one.
So what's my final verdict about these patterns? Simply none. We’re all human. We’re driven by our emotions, especially fear and greed.
That’s why you can memorize chart patterns until you’re blue in the face, then watch them blow up the next day. Those are tactics.
You’ve got to get the strategies right. If you want any chance of success, you need to know all the rules first or you should trade under following others as ForexCopier.com does.
Hope it'll work for your better trading experience than the previous one. Happy Trading!
A contracting triangle is characterized by five different points or legs of a triangle which connects a to c and b to d trend line, and it will end in a common point in the future. It will show the volatility of the market trend.
There are some categories of the contracting triangle pattern which shows the different angles of triangle patterns.
HORIZONTAL CONTRACTING TRIANGLE PATTERN
This pattern is a similar triangle pattern in the contracting pattern. In this pattern, every wave is smaller than the previous one and that's why it's the contracting triangle.
The very definition of such a triangle is, therefore, a>b>c>d>e. The name of such a triangle comes from the fact that it is evolving on the horizontal and, starting from its beginning, the price will form a series of ups and downs around that level until eventually, they will break higher or lower.
IRREGULAR CONTRACTING TRIANGLE PATTERN
An irregular contracting triangle pattern is commonly similar to the a-c and b-d trend line points. But there is the difference that a wave is smaller than the b wave.
The patterns will show only when wave c is completed. Both evolve similarly to a horizontal triangle. While a horizontal triangle is pretty common, an irregular contracting triangle pattern appears in most cases in the forex market.
Well, it's quite a smart move, this pattern shows the fake side that attracts traders from the wrong side.
RUNNING CONTRACTING TRIANGLE PATTERN
This pattern has a special fact that its endpoint will be above (while the market is bullish) or below (when the market is bearish).
Overall, this triangle pattern means it will run until the triangle is broken and the b-d trend line is the one that holds the key for any entry. In this triangle, the d wave is bigger than the c wave like the b wave is bigger than a wave.
In running the contracting triangle pattern, you can find the b wave is the longest one of all waves and the d wave is the shortest one.
So what's my final verdict about these patterns? Simply none. We’re all human. We’re driven by our emotions, especially fear and greed.
That’s why you can memorize chart patterns until you’re blue in the face, then watch them blow up the next day. Those are tactics.
You’ve got to get the strategies right. If you want any chance of success, you need to know all the rules first or you should trade under following others as ForexCopier.com does.
Hope it'll work for your better trading experience than the previous one. Happy Trading!