Symmetri🥃cal Triangles vs. Pennant Patterns: An Ovꦰerview

The symmetrical triangle and pennant are different chart patterns that are used in technical analysis to forecast price movements for traded assets. While both are continuation patterns with a good degree of reliabiliꦇty, there are two key differences between the two in terms of their formations.

Symmetrical Triangle

A symmetrical triangle chart pattern represents a period of consolidation before the price is forced to breakout or breakdown. A breakdown from the lower 澳洲幸运5官方开奖结果体彩网:trendline marks the start of a new bearish trend, while a breakout from the upper trendline indicates the start of a new bullish trend. The pattern is also known as a 澳洲幸运5官方开奖结果体彩网:wedge chart pattern.

The price target for a breakout or 澳洲幸运5官方开奖结果体彩网:breakdown from a symmetrical triangle is equal ꧅t🦄o the distance from the high and low of the earliest part of the pattern applied to the breakout price point.

Pennants

A pennant is a 澳洲幸运5官方开奖结果体彩网:continuation pattern in technical analysis formed when there is a large movement in a security, known as the flagpole, followed by a 澳洲幸运5官方开奖结果体彩网:consolidation period with converging trend lines - the pennant 🐼- followed by a breakout movement in the same direction as the initial large movement, which represents the second half of the flagpole.

Pennants, which are similar to flags in terms of structure, have converging trend lines during their consolidation period and last from one to three weeks. The volume at each period of the pennant is also important. The initial move must be met with large volume while the pennant should have weakening volume, followed by a large increase in volume during the breakout.

Key Differences

The Flagpole

Both the symmetrical triangle and the pennant have conic﷽al bodies formed during a period of consolidation. Price consistently reaches hig▨her lows and lower highs, creating two converging trendlines that form this conical shape.

However, the pennant includes a flagpole at the beginning of the pattern, which is not present in the formation of t🐷he symmetrical triangle. The flagpole is a very important characteristic of the pennant and is created when price suddenly spikes or dives dramatically in the direction of the current trend, forming an almost vertical line. This sharp move is accompanied by heavy volume and marks the beginning of an aggressive move within the current trend. Price then pauses, forming the body of t🌊he pennant, before breaking out in the direction of the trend with renewed vigor.

Duration

A second difference between the symmetrical triangle and the pennant is their durations. The pennant is considered a short-term pattern t🎃hat forms over a period of days or possibly weeks. Ideally, a pennant pattern lasts between one and four weeks. A triangle pattern can take much longer, sometimes forming over the course of months or years. In fact, if a pennant pattern drags on into its 12th or 13t🔴h week, it is usually considered to have become a triangle.

The breakout after a pennant pattern should occur at or near the point where the trendlines converge, called the apex. When dealing with a symmetrical triangle, however, it is optimal for price to break above or below the trendlines one-half to three-quarters of the way through the pattern. This means the pattern often never reaches its apex, forming a flat-topped cone rather than an actual triangle. A breakout is eventually forced one way or the other as price nears the apex. However, a breakout too early or too late may be indicative of a weaker pattern and a less robust continuation.

The Bottom Line

Both the 𒉰symmetrical triangle and pennant are characterized by a pattern of converging trendlines, with the price wavering between lower highs and higher lows.

However, pennants are shorter-term patterns, and they are distinguished by the presence of a flagpole. If a pennant continues for a prolonged period, it becomes a triangle pattern.