Symmetrical Triangle Signals Indecision

Pulte Homes (PHM), a large homebuilder, shows a symmetrical triangle price pattern. The red downside trendline of lower highs and the green upside trendline of higher lows is converging to form a symmetrical triangle.

A symmetrical triangle does not tell you where prices are headed but eventually they will breakout to the upside or to the downside. During the period of indecision, avoid the stock.

Updated April 8, 2008.