Lesson #44 What are Symmetrical Triangles? How To Invest Smartly After This Situation Occurs?

It is important to know that during forex trading there comes a time, when both the buyers and the sellers are coming to a draw. This means both are not willing to set a trend where you can find out whether or not the prices are going to increase or decrease. It is at this point if you join the graph of highest price rises in a single line and create a similar line by joining the lowest price falls, a triangle will emerge. These are known are symmetrical triangles.

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This situation may continue till the time both the lines come close to each other. Once the triangle is about to close, there is a sure possibility of a breakout in prices. This means this trend will no longer remain the same and prices could break the trend by either rising or going down.

This is a situation that can be used advantageously. You should try and put in two types of entries at this point. One of the entry orders should be above the graphic line indicating the highest price hikes. Another entry order needs to be placed below the price showing the lowest prices falls. With this strategy, whether the prices rise or fall, you can take make use of both situations.

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If you have put entry order above the graphic line indicating highest prices, and the market prices started rising, you would be in a comfortable position. However, when the market prices start rising, you will need to cancel the entry order placed under the graph of lowest prices once you noticed the trend of prices shooting upwards.