Symmetric triangle
neutral · bilateral pattern
The symmetric triangle is a bilateral continuation/consolidation pattern formed by a sequence of lower highs and higher lows that converge to an apex. Direction of breakout is not pre-determined; the pattern works as a volatility compression that resolves in either direction.
Formation rules
- Lower highs and higher lows converging
- At least two touches on each trendline
- Volume contracts as the pattern develops
- Breakout on expanding volume
How to trade it
Bracket the apex with stop-buy and stop-sell orders. Stop on the opposite side of the triangle. Measured move = triangle's widest height projected from breakout. Treat the pattern as volatility compression rather than a directional thesis.
Common pitfalls
- False breakouts are extremely common in the final third of the apex
- Avoid trading the apex itself
Statistical context
Bulkowski: roughly equal upside and downside breakout rates (~54%/46%), reinforcing the bilateral nature.
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