Symmetrical Triangle


DEFINITION of 'Symmetrical Triangle'

A chart pattern used in technical analysis that is easily recognized by the distinct shape created by two converging trendlines. The pattern is identified by drawing two trendlines that connect a series of sequentially lower peaks and a series of sequentially higher troughs. Both trendlines act as barriers that prevent the price from heading higher or lower, but once the price breaches one of these levels, a sharp movement often follows.

Symmetrical Triangle

BREAKING DOWN 'Symmetrical Triangle'

A symmetrical triangle is generally regarded as a period of consolidation before the price moves beyond one of the identified trendlines. A break below the lower trendline is used by technical traders to signal a move lower, while a break above the upper trendline signals the beginning of a move upward. As you can see from the chart above, technical traders use a sharp increase in volume or any other available technical indicator to confirm a breakout beyond one of the trendlines.

The sharp price movement that often follows a breakout of this formation can be captured by traders who are able to identify the pattern early enough.

  1. Triangle

    A technical analysis pattern created by drawing trendlines along ...
  2. Breakout

    A price movement through an identified level of support or resistance, ...
  3. Trendline

    A line that is drawn over pivot highs or under pivot lows to ...
  4. Continuation Pattern

    A technical analysis pattern that suggests a trend is exhibiting ...
  5. Breakout Trader

    A type of trader who uses technical analysis to find potential ...
  6. Consolidation

    In technical analysis, the movement of an asset's price within ...
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