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Written and copyright © 2008-2009 by Thomas N. Bulkowski. All rights reserved.
This page describes the reverse symmetrical triangle pattern of the Elliott wave principle, how price moves not in a straight line but in
a series of rises and retracements.
The figure to the right shows what a reverse symmetrical triangle looks like in a bull market. The reverse symmetrical triangle is a region of horizontal
price movement, a consolidation of a prior move, and it is composed of "threes." That means each of the A-B-C-D-E waves have three subwaves.
I labeled the B subwaves with red numbers, 1, 2, and
3, as an example.
In a reverse symmetrical triangle, the shape of the pattern follows two diverging trendlines, shown here as red lines.
A reverse symmetrical triangle is more commonly known as a broadening top or broadening bottom. According to
Frost and Prechter, "There are no variations on the rarer expanding triangle," which is another name for the reverse symmetrical triangle. I have not looked for
the 3-3-3-3-3 combination, but I do know that other broadening patterns exist. Check out: right-angled broadening top, ascending,
right-angled broadening top, descending, broadening wedge, ascending, and
broadening wedge, descending.
A reverse symmetrical triangle in a bear market is an inverted picture of a bull market triangle. The price action swings from trendline to trendline,
and diverges. The A-B-C-D-E waves subdivide into threes, forming a 3-3-3-3-3 configuration.
Rules
The reverse symmetrical triangle has rules that govern its shape. They are listed here.
- The waves bottom and top out following two diverging trendlines.
- Five waves compose the reverse symmetrical triangle (A-B-C-D-E).
- Each of the A-B-C-D-E waves are composed of three subwaves, so it has a 3-3-3-3-3 configuration.
-- Thomas Bulkowski
Copyright © 2008-2009 by Thomas N. Bulkowski. All rights reserved. Sure you can trust the government. Just ask a native American!
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