The actual symmetrical triangle pattern trading strategy makes use of price action the industry form associated with technical evaluation and is dependant on the symmetrical triangle- mainly considered the continuation pattern. Whenever a symmetrical triangle development is formed about the chart, this implies a period associated with consolidation inside a trend and next, the trend might resume.
The Symmetrical Triangle chart pattern is really a really efficient chart pattern which you can use for golf swing trading. This cost action trading pattern can come in any marketplace and on whenever frame. Like the majority of patterns, they’re more reliable about the higher time period charts.
The symmetrical triangle pattern is formed by converging of two trend lines where one is considered a resistance level and the other is considered a support level
Symmetrical triangles can be either bullish or bearish
- if a symmetrical triangle forms after an uptrend, this is considered bullish.
- If a symmetrical triangle forms after a downtrend, this is considered bearish.
Since the symmetrical triangle is recognized as a extension pattern, you need to watch for that breakout to happen in the entire trend path.
Symmetrical triangles can be quite profitable whenever you trade the actual breakouts which happen possibly downwards or even upwards.
SUCCESSFULLY TRADING THE SYMMETRICAL TRIANGLE CHART PATTERN
These are the two important things to be able to trade the pattern successfully:
- know what you are looking for and being able to spot the symmetrical triangle as it is being formed
- get in at the right time near the breakout point which can be either the support or resistance trend line depending on the trend direction
CHARACTERISTICS OF SYMMETRICAL TRIANGLE PATTERNS
- The two trendlines drawn in the formation of the triangle should have similar slope at a point know as the apex.
- The price will bounce between these trendlines towards the apex.
- The breakout as most times will happen about 3/4 of the way towards the apex. This pattern become unreliable if price gets inside the apex.
- The breakout often happens in the direction of the original (prior) trend
HOW TO TRADE THE SYMMETRICAL TRIANGLE CHART PATTERNS
Look for this trading pattern in both an uptrend and down trend. We are looking for the breakout of the support or resistance trend line in the direction of the overall trend.
This is not a reversal trading pattern. For those, you may want to consider other price patterns such as ascending and descending triangles.
- Wait and watch for a candlestick to breakout of the triangle pattern. This candlestick must then close outside the descending or ascending trendline.
- Once this candlestick closes, depending on which side the candlestick closes, you either place a buy stop/sell stop order 2-5 pips from the closing price of that candlestick.
- Set your take profit target equal to the “pattern height.”
Stop loss must be set and there are a few ways you can do this:
- If you placed a buy stop order, place your stop loss anywhere from 10-30 pips (this depends on what time frame you are using to get into this trade) under the low of the candlestick that broke out of the triangle chart formation
- You are able to place your own stop loss on the other hand of the actual triangle chart formation…that is should you were to consider a sell trade, enabling you to have positioned your sell cease order then this really is where a person place your own stop reduction. Stop reduction placement about this area is very effective while you would possess less possibility of being halted out too early.
- You can place is at halfway point between the descending and ascending trend lines just right where the breakout happens.
- If you place a sell stop order, place your stop loss 10-30 pips above the high of the candlestick that broke the triangle pattern.
HOW TO MANAGE YOUR TRADE THAT IS IN PROFIT
- When your trade is in profit and is halfway towards hitting its profit target, you can move stop loss break even to minimize your risk
- You can take half of the profits and leave the other half running.
- Continue to lock your profits by moving your stop loss and trailing it behind higher swing lows as price moves upwards to your profit target(this is for a buy order).
- Do the opposite for sell order: move stop loss for each lower peak that forms until your take profit is hit.
ADVANTAGES OF THE SYMMETRICAL TRIANGLE PATTERN TRADING SYSTEM
- the symmetrical chart pattern trading system is usually a very explosive breakout swing trading system. if you catch the breakout at the right time, profits come fast.
- its based on price action and there is really no need to add any other indicator-keep it simple.
- the symmetrical chart pattern happens in all time frames
Any kind of trader that actively seeks this kind of chart pattern should have an objective way to draw the actual trend outlines. This enables consistency inside your approach that doesn’t change through Forex trading in order to trading futures. Maintain everything constant.
Please use at-least one of the below share button if you like this.