Market Still in Triangulation Zone

Feb 20, 2008: 10:42 AM CST

The US Stock Market still has failed to break its recent symmetrical triangle or coil pattern, and the pattern is still forming on the major indexes.

Let’s peek:

Most triangles resolve 66% to 75% of the way to the apex, and that is approximately where we are. Volatility has narrowed and typically price will eject into a trend move following these consolidation periods.

Triangles are mostly continuation patterns, meaning that the odds slightly favor resolution to the downside, but no pattern and no market prediction is ever 100% accurate, and this triangle could break to the upside as well.

Volume has also been declining as the triangle formed, which further confirms the pattern.

I drew the most recent triangle pattern, which occurred throughout the month of December. That particular triangle consolidation resolved to the downside. What will February’s consolidation do?

We’re currently in “wait and see” mode.

2 Comments

2 Responses to “Market Still in Triangulation Zone”

  1. Stock Market » Market Still in Triangulation Zone Says:

    […] Corey Rosenbloom wrote an interesting post today on Market Still in Triangulation ZoneHere’s a quick excerptThe US Stock Market still has failed to break its recent symmetrical triangle or coil pattern, and the pattern is still forming on the major indexes. Let’s peek:. Most triangles resolve 66% to 75% of the way to the apex, … […]

  2. Timing the Market | Stock Picks and Discussion at iBankCoin.com Says:

    […] have access to the real time machine, but based on what I see, here’s the direction I think much discussed triangle formations will […]