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| Symmetrical Triangle (Coli) Chart Pattern |
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| Written by Kimball Hall | |
| Monday, 24 November 2008 | |
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Trading the Symmetrical Triangle provides you with all the necessary points to trade it successfully. That is, it provides an entry point, target, and stop. Finding the set only requires the following : 1. An established trend 2. Trend line on the top that has at least two points on it and is sloping down 3. Trend line on the bottom that has at least two points and is sloping up With these three things, the setup is complete and you can go about setting up the trade. Keep in mind the following, when identifying and setting up the trade: 1. Symmetrical Triangles are usually continuation patterns. Although they are usually a continuation patterns that does not mean they always are. The breakout needs to be confirmed. 2. In stocks, there needs to be s decline in volume associated with the formation and an increase in volume associated with the break out. For Forex you can use am ADX, RSI or similar method to measure the strength of the break out. 3. The breakout should happen at a distance greater than ½ to ¾ of the length of the triangle. With this in mind let’s take a look at a potential setup. This is on the USD/JPY chart. With this set up we would be looking for the price to break lower and continue in the direction of the major trend that is currently in place.  The symmetrical Triangle has been formed over a 3-4 week period. We would expect a break out to be coming soon now that we are almost ¾ of the way through the breakout. Your target would be equal to the widest point of the triangle extended to the top or the bottom at the point of breakout.
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