Triangles are constructed of five waves that are labelled as a, b, c, d and e.
Each wave of a triangle fractal is constructed of three subwaves
In up trend waves of a corrective triangle bounce between a downtrend from above and up trend or horizontal support below.
Each wave of a triangle starting from wave b is shorter than the previous wave
After a set of four or five waves decreasing in size and volume the majority of traders stop trading and start to wait either for breakdown or breakout through contracting trend lines
There are many cases when the final wave e plays a fake breakdown only to fool traders and run stop loss orders.That fake move under a strong support quickly reverses and gives birth to a strong rally in direction of the main trend
When all five waves of a corrective triangle finally play out completing the triangle fractal the trend interrupted by a triangle resumes with a powerful spiky move.
Price never travels in a straight line for too long, it travels in zig-zags shaped as A-B-C
Wave A is an initial Action, Wave B is a reaction to the first move, Wave C is a resolution to both preceding waves A and B
In up looking A-B-C fractal the starting point of the wave A is the main support for the whole A-B-C up fractal. Reactionery Wave B down may come back up to the lowest point of A but never should violate it
In down looking A-B-C fractal the starting point of the wave A is the main resistance for the whole A-B-C down fractal. Reactionery Wave B up may come back up to the highest point of A but never should violate it
In up looking A-B-C fractals Wave C either retests or more often makes new higher high over a high made by Wave A.
In down looking A-B-C fractals Wave C either retests or more often makes new lower low under a low made by Wave A.