Triangles

What it means

A triangle is a converging range: the swing highs and the swing lows approach each other, so the distance between the boundaries shrinks. A symmetrical triangle has both boundaries sloping inward; an ascending triangle has a flat top and a rising bottom; a descending triangle has a flat bottom and a falling top.

The family resemblance is convergence, and that resemblance is exactly what makes the vocabulary slippery — several other shapes converge too.

How we detect it

The engine fits a straight line through the last few swing highs and another through the last few swing lows, requiring at least three swings on each side. It then measures the distance between the fitted lines at the start of the fit and at the last bar, and requires the spread to have closed to at most seventy per cent of what it was.

A boundary counts as flat when it drifts less than one ATR across the WHOLE fitted span, rather than by some per-bar amount that would silently mean a different total on every fit length. Ascending is a flat top with a rising bottom, descending a flat bottom with a falling top, and symmetrical requires both boundaries to slope inward and neither to be flat.

A falling wedge converges as well, and it is NOT any of these three, so the function returns nothing and the analysis says nothing. Vocabulary this publication uses in public has to mean what it says.

When the read carries information

• There are at least twenty bars and three clean swings on each boundary, so the lines are fitted to real turns.
• The convergence is genuine rather than an artefact of one enormous early swing setting a wide starting spread.
• The timeframe is slow enough that swings are separated by real time.

When it misleads

• Any converging shape that is not one of the three named kinds produces silence, which a reader may misread as an absence of structure.
• A least-squares line is sensitive to its endpoints, so one late swing can change the classification of an otherwise unchanged chart.
• Where two swings sit close together in time, the fit can describe a segment much shorter than the shape a reader sees.

How it reaches you

When a triangle is reported, it comes with the number of touches on each boundary and the spread at both ends, so a reader can judge the fit rather than take the word.

The classic teaching attaches a direction to each of these shapes. This publication does not: a triangle here is a description of a range that has been narrowing, and nothing else.