A symmetrical triangle is a chart pattern characterized by two converging trend lines connecting a series of sequential peaks and troughs. These trend lines should be converging at a roughly equal slope.
1. Symmetrical triangles occur when a security's price is consolidating in a way that generates two converging trend lines with similar slopes.
2. The breakout or breakdown targets for a symmetrical triangle is equal to the distance between the initial high and low applied to the breakout or breakdown point.
3. Many traders use symmetrical triangles in conjunction with other forms of technical analysis that act as a confirmation.
The price target for a breakout or breakdown from a symmetrical triangle is equal to the distance from the high and low of the earliest part of the pattern applied to the breakout price point. The stop-loss for the symmetrical triangle pattern is often just below the breakout point.
Trade active
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NTPC was struggling to move above 119 for the past 11 trading sessions. It has broken past that level and made a high of 122 today.
The target on the long side could be roughly around 130, if calculated keeping in mind the width of the triangle.
A long can still be initiated at the CMP of 120 with a stop loss beneath 116 and targets of 130.
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Tradeception_
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@Angusmck, Wow! Thank you so much. You have made my day, this encourages me to share a lot more. Thanks again. :)
prakashgd
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Levels has been retested. Good time to enter now? Since there is upcoming result..
Tradeception_
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@prakashgd, One could enter, I suppose, the stop would be small from this point, but the bearish engulfing formed on 20.07.21 is a worrying factor. Price has seen rejection again from an intraday high of 122 exactly, so a more sure scenario would be at the break of 122.
@kalpeshchowkekar2, If stop loss is maintained at around 116 for an entry price of about 120, one can wait for around 124 to book partial position and then trail the stop loss of remaining position to cost price, then it will become a risk free trade. Thank you for the comment. :)
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