UK100 Indices Symmetrical triangle pattern. Target 6675

UK 100 Sell Below 6800 CMP 6830 Stop @ 6875 TGT 6725 - 6675

A Symmetrical Continuation Triangle (Bearish) is considered a bearish signal, indicating that the current downtrend may continue.

Description

A Symmetrical Continuation Triangle (Bearish) shows two converging trendlines, the lower one is ascending, the upper one is descending. The formation occurs because prices are reaching both lower highs and higher lows. The pattern will display two highs touching the upper (descending) trendline and two lows touching the lower (ascending) trendline. This pattern is confirmed when the price breaks out of the triangle formation to close below the lower (ascending) trendline.

Target Price

The target price provides an important indication about the potential price move that this pattern indicates. Consider whether the target price for this pattern is sufficient to provide adequate returns after your costs (such as commissions) have been taken into account. A good rule of thumb is that the target price must indicate a potential return of greater than 5% before a pattern should be considered useful. However you must consider the current price and the volume of shares you intend to trade. Also, check that the target price has not already been achieved.

UK100 is forming Symmetrical triangle pattern formation from the high of 6895 and support of 6771 and after it enter in the range bound, where it made lower top and higher bottom formation. It’s nearing the lower support level of 6800 and sustain below 6800 on closing basis it will give a confirmation of the breakdown of the triangle. Height of the triangle comes to 124 points (6895 - 6771) and calculation the target from the breakdown point of 6800(6800 - 124 = 1217) expected target comes to 6676$ in near to medium term. Below 6676 might go and test the previous bottom of 6550 – 6500 level.