Ask Colin

Re your August 2001 article in Shares: In the three examples you used the symmetrical triangles appeared over a six to twelve month period. Can this behaviour occur over a much shorter period of time, say two to three months? For example I believe Tabcorp Holdings broke out of a symmetrical triangle in late January this year. I believe this triangle began in December 2000.

Re your August 2001 article in Shares: In the three examples you used the symmetrical triangles appeared over a six to twelve month period. Can this behaviour occur over a much shorter period of time, say two to three months? For example I believe Tabcorp Holdings broke out of a symmetrical triangle in late January this year. I believe this triangle began in December 2000.

Triangles can form over almost any time period. If they form over only a few days in a fast moving market, they tend to be called Pennants, which are short term continuation patterns. If they form over longer time period, they will be triangles and can be either continuation or reversal patterns, depending usually on the direction of the breakout.

The rule is that the bigger the range of the triangle and the longer it takes to form, the more significant the pattern is. So, the Tabcorp pattern would have less significance than the patterns in the article, which formed over many months. This answer is a discussion about charting principles and is not a recommendation to buy or sell Tabcorp Holdings.

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