Dow Jones Industrial Index Symmetrical Triangle

Symmetrical triangles are generally considered neutral, ascending triangles are bullish, and descending triangles are bearish. From a time perspective, triangles are usually considered to be intermediate patterns. Usually, it takes longer than a month to form a triangle. Seldom will a triangle last longer than three months. If a triangle pattern does take longer than three months to complete the formation will take on major trend significance.

Converging trendlines of support and resistance gives the symmetrical triangle pattern its distinctive shape. This occurs because the trading action gets tighter and tighter until the market breaks out with great force. Buyers and sellers find themselves in a period where they are not sure where the market is headed. Their uncertainty is marked by their actions of buying and selling sooner, making the pattern look like an increasingly tight coil moving across the chart.

A breakdown below the lower symmetrical support will trigger a test of the previous sub-trough at 12069.5. Support failure here increases downward pressure to break the next support at 11644.8 and retest the green parallel support line. The hammer candlestick formation needs a strong confirmation from the next candlestick bar to gain momentum to clear the previous sub-peak and trigger a challenge to breakout above the upper symmetrical resistance line. This will propel price towards the red parallel resistance line. Breakout here will result in a more positive outlook for the Dow Jones Industrial Index.