Symmetrical triangle

What it is

A symmetrical triangle forms when price makes lower highs and higher lows at the same time. The two trendlines converge toward a point. Unlike the ascending and descending versions, neither side is flat, so the shape itself does not favour a direction. It completes when price closes outside one of the lines.

Why it forms

Buyers and sellers are both becoming less aggressive. Sellers accept lower prices on each rally; buyers accept higher prices on each dip. Volume usually shrinks as the range tightens. The compression cannot last forever — at some point one side commits, and price leaves the triangle.

How to identify it

• At least two lower highs and two higher lows.
• Converging lines with roughly similar slopes.
• Volume contracting during the pattern.
• Often a trend before it — the pattern frequently resolves in that trend’s direction, but not always.

What confirms it

A candle close outside the triangle, ideally with volume expanding. Direction is set by the break, not guessed in advance.

What invalidates it

• A break that quickly closes back inside the triangle.
• Price drifting all the way to the apex without a decisive break — the pattern loses meaning.

Common mistakes

• Guessing the direction early. The whole point is that the market has not decided yet.
• Too few touches. Two points make a line; you need two on each side.
• Confusing it with a pennant. A pennant is small and follows a sharp pole.
• Treating the measured move as a forecast. It is a reference for scale.