I hope you are doing well. In this article I will explain you how I use triangle patterns to confirm my binary options trades, especially when I want to trade with the trend. Let’s go to the first screenshot. It’s from USDCHF currency pair.
First of all, one basic thing in technical analysis and generally in trading which every trader should know it are trend lines. It’s very easy to draw a trend line. You need two tops or two bottoms and just connect them and you have very fast your trend line. As you can see in the screenshot, I connected two tops and I drew a trend line. A trend line can can acts as a resistance or a support. In this case, you can easily see that we are in a down trend. Notice the spot in which the price hit the trend line. It makes a reversal and we have a resistance. In an up trend we have the opposite condition. You should connect two bottoms and the trend line then acts as a support.
In the second screen shot you can see that we are again in a down trend. The price hit the trend line about two times and makes reversals. Notice, that we have lower- highs a sign of a down trend. Now, the important thing of the second screen shot is the blue box. In the blue box the price breaks the trend line and maybe this is is a sign of the end of the bearish trend and the beginning of a new bullish trend.
If you have two trend lines close to the same spot you can create a triangle. Take a look in the screen shot.
We have two trend lines now, one up and another one down. You could take trades inside the triangles because they are acting as support and resistance. When the price breaks the triangle(upwards or downwards) it’s a signal of a possible new trend for me or a signal that the price will go to this direction. You should be wait to see a clear break of the triangle and after that take your trades. Of course you should always have confirmation. I never take trades only by one signal. Many times, when I notice a clear trend I wait for a small reversal based on Fibonacci or Elliot Wave Theory and after the retracement I trade with the trend direction. Triangles and trend lines breaks give more confidence to my trades.