Triangle pattern price breakout stocks

Both ascending and descending triangle signals and screeners are powered by an automated stock pattern detection system. The current implementation is focused on medium- to long-term investors and primarily operates on daily stock candles. Every day, the system runs pattern detection algorithms to identify new formations and performs more frequent intraday checks on already formed patterns, ensuring timely and accurate information.

The primary goal of triangle pattern detection is to identify price breakouts promptly, enabling users to capitalize on potential opportunities. However, it is important to independently verify the accuracy of the detected patterns before making any investment decisions based solely on the pattern detection results.

How to use this screener

This screener has two primary notification mechanisms to help you track the changes in the list of triangle pattern identified stocks.

• Global Signals: Click on "Enable Signal Notifications" to receive daily email on state changes across all active triangle pattern detections. 
• Stock-Specific Signals: By clicking the star icon next available in each row of the screener table, you will start receiving intraday updates in relation to watched stock, including triangle pattern signals.

Please note that since this is a premium screener, only paid users are able to subscribe to notifications. As a free user you can still watch selected stocks, but pattern information may be omitted or redacted from notifications.

Understanding triangle patterns

Current screener is focussed solely on two well known patterns:

• Ascending Triangle: This pattern is characterized by a horizontal upper trendline and an ascending lower trendline. It suggests a potential bullish breakout. 
• Descending Triangle: This pattern features a horizontal lower trendline and a descending upper trendline, indicating a possible bearish breakout. 

Even though both patterns have preferred break out direction, it's totally valid for them to break out into opposite direction, such break outs are still at play and will be tracked by our system.

There are plans to introduce additional pattern identification in near future, but those patterns will likely get their own screeners. Meanwhile if feel free to explore other screeners that Stocklytics has to offer, such as Golden Cross stocks or Death Cross stocks. 

Triangle pattern detection methodology

Every day our system runs checks on about ~5,000 stocks time series with a purpose of identifying triangle patterns. As mentioned before current screener version is focussed on daily candles.

In order for a ascending or descending triangle pattern to form, at least 4 pivot points are required. Two out of 4 pivot points has to be placed on the base of triangle, while the other two has to be on the trendline of the triangle. 

Once pattern is formed, system will monitor intraday price to leave the boundaries of the formed pattern, at which point pattern stage will change to "Breakout". Detection algorithm is configured to have a certain thresholds that measure volume and distance from the support or resistance lines in order to reduce the possibility of false break outs.

Target price and stop loss logic

The target price is set based on the height of triangle base from the entry price. Stop loss is places either at the based of triangle or second highest pivot point depending on the type of triangle itself. Please note that this logic is subject to change as we constantly strive to improve our detection algorithms and related logic.

Triangle pattern states & stages

Each detected pattern has it's pattern stage timeline, which allows users to explore when each pattern stage took place, simply hover the date shown in "stage timeline" column. Here is short explanation and meaning of each stage:

• Formed: Minimum of four pivot points detected, allowing for triangle formation.
• Breakout: Pattern breaks out in either direction.
• False Breakout: Intraday price returns within the triangle.
• Breakout Re-test: Price breaks out again after a false breakout.
• Consolidated: Price hits the take profit target.
• Invalidated: Price hits stop loss or pattern becomes invalid.
• Missed with Profit: Breakout occurs, but price does not hit take profit within a week, and trade closes with a profit.
• Missed with Loss: Similar to missed with profit, but trade closes with a loss.