Rectangle channel patterns consist of two parallel trendlines
bounding the price-action having multiple pivot
points forming at equal highs and equal lows. As price
approaches the lower trendline, bullish sentiment sets to
push the price up towards the upper trendline, and when
the price reaches the upper trendline, bearish sentiment
tends to push the price down towards the lower trendline,
thus creating a tug-of-war. Each of these thrusts must
form at least two key pivot points on the upper and lower
trendlines to create a rectangle channel. This bounded
range becomes a consolidation area, where traders are
indecisive and may not take trend-based trades.
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INVESTING STOCKS, FUTURES, OPTIONS, FOREX OR COMMODITIES CAN BE SUBSTANTIAL.
YOU SHOULD THEREFORE CAREFULLY CONSIDER WHETHER SUCH INVESTMENTS
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INVESTMENT EXPERIENCE AND OBJECTIVES, FINANCIAL RESOURCES AND
OTHER RELEVANT CIRCUMSTANCES. PAST PERFORMANCE IS
NOT NECESSARILY INDICATIVE OF FUTURE RESULTS, AND LOSSES ARE ALWAYS
POSSIBLE. THE STRATEGIES OR TRADE SETUPS MENTIONED
HEREIN SHOULD NOT BE CONSTRUED AS CONSERVATIVE STRATEGIES BUT
RATHER SPECULATIVE AND FOR SHORT-TERM TRADING PURPOSES ONLY.
THERE IS EQUAL OR GREATER POTENTIAL FOR LOSS WHILE USING THIS STRATEGY AND TRADE SETUPS.
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