A Second SPY Intraday Triangle Forms March 12

Mar 12, 2010: 12:19 PM CST

Following up from yesterday’s post “Get Ready for Range Expansion Play from SPY Intraday Triangle,” we see that we indeed get the range expansion breakout trade as expected by the symmetrical triangle of yesterday.

Not only does it serve as a great example of real-time identification and follow-through of the pattern, but we see a similar though smaller compression triangle forming today at 1:00 EST on the SPY.

Let’s see this development and note key breakout trendline levels to watch.


(Click for full-size image hosted by Chart.ly)

I happened to capture yesterday’s triangle minutes before the expected price breakout, and we’re winding down to the apex of the current triangle now.

This means traders would be looking to buy a breakout above the $115.50 area or short a breakdown under $115.25 – again another 25 cent compression in trendlines.

I’m using a pure price chart above so you can see how to draw the trendlines and visualize the price compression better.

Be ready for another potential range expansion move from a breakout of this smaller triangle, and note the ‘apex’ level just under $115.00 as a possible support target, or the morning high of $116.00 to play a potential upside breakout resistance target.

See my prior educational page on “Trading Price Triangles.”

Corey Rosenbloom, CMT
Afraid to Trade.com

Follow Corey on Twitter:  http://twitter.com/afraidtotrade

5 Comments

5 Responses to “A Second SPY Intraday Triangle Forms March 12”

  1. Jim Makos Says:

    An excellent read! I just launched my new trading blog and added your blog's feed to my reader to keep up with your news. I'll be checking back quite often.

    Jim
    http://www.tradinggraphs.com

  2. JXXXD Says:

    just found you – good reaL TIME OBSERVATIONS

  3. Client Says:

    Very interesting. But traders also should be careful with triangles because a price often breaks above/below their trendline and retraces back bringing losses to many people…

  4. Client Says:

    Very interesting. But traders also should be careful with triangles because a price often breaks above/below their trendline and retraces back bringing losses to many people…

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