Tesla (TSLA) — Symmetrical Triangle Breakout IdeaSummary
Pattern: Symmetrical triangle on daily chart.
Expected timeframe for breakout: Within 1–2 weeks.
Targets: $367 on an upside breakout; $273 on a downside breakout.
Risk management: Use a stop-loss just outside the triangle after breakout confirmation; position size per your risk rules.
Setup & Rationale
A well-defined symmetrical triangle has formed on TSLA’s price action, characterized by converging trendlines connecting lower highs and higher lows. Volume has contracted inside the pattern, consistent with consolidation. Symmetrical triangles are neutral continuation/reversal patterns; the breakout direction provides the trading signal.
Key technical points:
Price is approaching the apex, increasing the likelihood of a decisive breakout in the next 1–2 weeks.
Volume decline during the consolidation and a volume spike on breakout would confirm conviction.
The breakout should be taken after a daily close beyond the upper or lower trendline (or after a retest), not merely intraday probes.
Entry Criteria
Upside trade: Enter long on a daily close above the upper trendline (or on a confirmed retest).
Downside trade: Enter short on a daily close below the lower trendline (or on a confirmed retest).
Targets & Measurement
Measure the pattern height (vertical distance between the initial high and low of the triangle) and project it from the breakout point.
Upside target (projected): $367.
Downside target (projected): $273.
Adjust targets proportionally if you use a measured move from the actual breakout point rather than the pattern’s maximum height.
Stops & Risk Management
Place stop-loss slightly outside the opposite trendline or beyond a recent swing point to avoid false breakouts.
Preferred approach: fixed-risk percent per trade (e.g., 1–2% of portfolio) and scale position size accordingly.
Consider tightening stops to breakeven after price clears ~50% of the distance to the target.
Confirmation: daily close beyond trendline plus above-average volume (up or down depending on direction).
Symmetrical triangles are neutral; false breakouts occur. Wait for confirmation.
News, earnings, or market-wide events can invalidate technical setups quickly—monitor catalysts.
Adjust targets/stops if volatility expands or if the breakout lacks volume confirmation.
