What Does Symmetrical Triangle Mean? 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. A symmetrical triangle is generally regarded as a period of consolidation before the price […]

What Does Wedge Mean? A technical chart pattern composed of two converging lines connecting a series of peaks and troughs. Falling wedges indicate temporary interruptions of upward price rallies. Rising wedges indicate interruptions of a falling price trend. Technical analysts see a ‘breakout’ of this wedge pattern as either bullish (on a breakout above the upper line) or bearish (on a breakout below the lower line).

What Does Continuation Pattern Mean? A technical analysis pattern that suggests a trend is exhibiting a temporary diversion in behavior and will eventually continue on its existing trend. The symmetrical triangle charts displayed below are both exhibiting a continuation pattern. Notice how the chart extends above (below) its existing pattern. Continuation patterns tend to be the most accurate when the trend has existed for around one to three months. The most common types of continuation patterns are triangles, flags and wedges.

What Does Ascending Triangle Mean? A bullish chart pattern used in technical analysis that is easily recognizable by the distinct shape created by two trendlines. In an ascending triangle, one trendline is drawn horizontally at a level that has historically prevented the price from heading higher, while the second trendline connects a series of increasing troughs. Traders enter into long positions when the price of the asset breaks above the top resistance. The chart below is an example of an ascending triangle: An ascending triangle is generally considered to be […]