Chart Pattern Symmetrical Triangles by ForexExplore | CountingPips Forex & Currency Trading Articles

Chart Pattern Symmetrical Triangles

by ForexExplore

One of the pattern formations in forex trading is called Symmetrical Triangle. This pattern is formed when a sequence of higher price values creates a line and a sequence of the lower price values creates a line and together they form a triangle.

Symmetrical Triangle is formed when neither the buyers nor the sellers manage to take over the price movement. As the lines of the triangle are closing the gap between them, forex traders expect a breakout. At some point the competition ends and either buyers or sellers give up. Whenever the barrier formed by the triangle is breached a distinctive movement often follows.

symmetrical triangles in forex trading

Symmetrical triangle indicates consolidation during uptrend or downtrend and therefore hints for a breakout. Since the breakout is unavoidable symmetrical triangle is extremely useful. The direction of the market is visible enough for forex traders to place orders. And even if a mistake is made, it is possible to cancel the first order fast enough to still make the right decision.

The breakout below the lower triangle line is the beginning of a upward move, while the breakout above the upper line triangle line is the beginning of a downward move.

If you manage to identify the pattern early, you will be able to benefit from the distinctive price movement which often follows a breakout.

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