Trading gold as per triangle formation. Take a look at our charts and find how to trade this forex chart formation.
As we can see from the picture, we are looking at the chart of the gold.
What we can see is that in the first place we have an uptrend.
We have said more than once, the most reliable positions are the one following the trend.
Trading Gold Using Triangle
We see that the price is trying to break the previous high, but without any success.
At this point, we can only wait to see what the graph will show us. We can draw a trend line on the tops and one on the last bottoms.
Here we come to the formation itself.
Here we want to give you some information about the triangle figure itself. As we see this figure is following the trend. For a more reliable entry we have to wait for a break of the trend line that we have drawn at the top of the chart.
We draw this trend line so that we can determine where can we set our take profit.
Or basically where will be the point we are interested of being on this trade.
After drawing the trend line, we move it at the breakout.
You can see where we put this trend line to determine our take profit.
You can also see that we already have 2 open positions – “BUY”
Pay attention to the stop loss levels.
The stop loss level of each position is set on the previous bottom. This is the way to determine the stop loss level of each position when trading this triangle formation.
A few hours later, the price reached the end of the trend line.
We advise you not to chase the very end of the trend line, but about 80% of it.
Because the market can surprise us. You can also see that we have moved the stops on both positions on to +this way we guarantee a certain profit if the market makes correction or we get a reversal of the trend.
At the end of the article there is a video in which you can see in detail how we traded our signals, along with a detailed explanation.
Live video trading
Here is some information about the video.
We made this video so you can see step by step how we use the triangle formation following the trend on gold. Apart from the formation, let’s also pay attention to the money management.In this video we show how we can open more than one position in this ascending triangle. We also emphasize the break of the upper trend line, when it is broken this is a very reliable signal for us.
And it is even more reliable when the candle itself that makes the break closes above the broken trend line.
And last but not least, we have paid attention to determining the profit, or in simple words how long should we keep those positions open.Here we want to emphasize that it is not good to always look for 100% of the profit. Once you have applied the height, and you have determined your profit, it is good to look for 80% of this profit.These 80% are more reliable, because in 85% – 90% of these formations, the price reaches 80%. We recommend that you play as safely as you can, both when entering and exiting a position.