As I was suggesting earlier in the day, the symmetrical triangle is one of the more common setups that we see - but this doesn't mean that there is anything wrong with them. We keep all of our setups on the blog so it may be worth taking a look at some of the older ones and seeing how they have played out so you can get an idea not only of performance but also as to where you may wish to place future stop points and profit targets.

Once you have isolated the bounds of the triangle you are naturally waiting for the breakout to occur - typically the trader will wait for at least 1 close outside the pattern before entering to reduce whipsaws but as I say it's worth looking at previous examples to help try an optimise this. Remember that there's no bias to the long or the short side with this pattern so you will typically trade the direction of the breakout.

The profit for this type of trade is projected by measuring the height of the pattern (~$0.28) from the breakout point. This doesn't have to be a hard target though because you may choose instead to tighten and then trail your stops when this level is reached. Some traders may choose to start trailing their stop earlier - for example after the price have moved beyond the 61.8% projection of the height of the pattern.

As for your stop loss the triangle standards are to place either just on the inside of the pattern from the breakout or on the far side altogether. Remember that the former offers a better risk/reward but a greater chance of being whipsawed.

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All the best,