Ascending triangle
A chart pattern of rising swing lows against one flat resistance level — a bullish continuation pattern signalling that buyers are gradually overpowering sellers before a breakout.
In plain language
Picture a stock repeatedly running up to the same price and being turned back, but each time it pulls back less than the time before.
That rising floor against a flat ceiling is an ascending triangle. Buyers are getting more eager each time, even though sellers are still defending the same level — and the pattern usually resolves in the buyers' favour.
How it works
The workbook: "An Ascending Triangle pattern forms when the market forms a series of higher lows while repeatedly testing the same resistance level. It typically appears during an uptrend and is considered a bullish continuation pattern... Bulls gain almost full control, running up to the top resistance line of the pattern."
Drawing the pattern needs at least two swing highs and two swing lows for the trendlines. A long trade is taken on a break above the top of the pattern; a short trade is taken if price instead breaks below the rising lower trendline. The profit target is calculated by taking the height of the triangle at its thickest point and adding it to the breakout point.
A worked example
A stock repeatedly tests resistance at Rs 500, while its swing lows rise from Rs 460, to Rs 470, to Rs 480 — a narrowing, ascending triangle.
Height of triangle at its thickest point = Rs 500 − Rs 460 = Rs 40
Breakout above resistance at Rs 500
Profit target = Rs 500 + Rs 40 = Rs 540
Once the price breaks decisively above Rs 500 on strong volume, a trader following this pattern targets Rs 540 — the breakout point plus the triangle's widest height.
Why NISM asks about it
Chapter 15.6.2 (Ascending Triangle) gives the pattern definition and the profit-target rule. Expect a question that gives price levels forming a triangle and asks for the profit target, or one asking to identify an ascending triangle as a bullish continuation pattern seen in an uptrend.
Common exam traps
- Ascending triangle (rising lows, flat resistance) is bullish; descending triangle (flat support, lower highs) is bearish; symmetrical triangle (both lines converging) is direction-neutral — the three patterns are easy to mix up in a question that only sketches the shape.
- The profit target rule uses the triangle's height at its thickest point, not at the point closest to the breakout.
Check yourself
1.A stock forms an ascending triangle with flat resistance at ₹680. Its rising lows are ₹590, then ₹625, then ₹652, and it breaks out above ₹680. Applying the workbook’s rule, what is the profit target?
- a)₹708
- b)₹735
- c)₹770
- d)₹680
Show the answer
Answer: (c) ₹770
The rule is: take the height of the triangle at its thickest point and add it to the breakout point.
- The thickest point is the left edge, where the rising lower trendline is furthest from resistance — the first low, ₹590.
- Height = 680 − 590 = ₹90
- Target = breakout ₹680 + ₹90 = ₹770
₹708 comes from measuring at the last low (680 − 652 = 28), which is the triangle at its thinnest — the exact error the phrase "at its thickest point" is there to prevent. ₹735 uses the middle low. ₹680 comes from adding the height to the swing low instead of the breakout, which merely returns you to the breakout level.
The same measured-move logic applies to a channel, where the workbook calls it channel width projection.
Where this is taught
Free preparation for NISM Series XVRelated terms
- Bar chartA technical-analysis chart showing each period's Open, High, Low and Close as a single vertical bar with side ticks — used to study price range and volatility.
- ChannelTwo parallel trendlines, one through the highs and one through the lows, boxing price action into a range — traders trade within it, or watch for a breakout from it.
- Congestion areaA price range where a stock trades repeatedly for an extended period, typically several weeks, before eventually breaking out upward or downward.
- Support and resistancePrice levels where a move tends to pause or reverse — support where demand concentrates and forms a floor, resistance where supply concentrates and forms a ceiling.
- Flag and pennantContinuation patterns in which price pauses sideways after a sharp rally — in a rectangle (flag) or a small triangle (pennant) — before the original move resumes.