The consolidation pattern is a manifestation of no longer moving forward after a period of rapid changes, fluctuating up and down in a certain area, causing the trend to temporarily pause and begin to enter a state of rest. However, these patterns generally do not last too long, and then the currency price will choose a breakthrough direction, because in the end most patterns will choose to break through in the direction of the original trend, and then continue to run along the trend. The main consolidation patterns include "flag shape", "wedge shape", etc. I usually like to talk about triangle consolidation. There are many names for flag consolidation, and the most professional name is wedge structure.
Wedge consolidation pattern:
Symmetrical triangle or wedge
Ascending triangle or wedge
Descending triangle or wedge
(Just look at the specific definition, you can search on Baidu, and you will understand everything by looking at the picture. It is worth noting that an upward shape does not necessarily mean an increase, and a downward shape does not necessarily mean a decrease)
What needs to be observed more is the support and pressure of the market, the coordination structure, the transactions within the structure, and the movement of the upper and lower edges of the range. This is one of the very simple techniques.
At the same time, we can notice that there is not much fluctuation during the consolidation period. Therefore, this period of consolidation is also a good time to move back and forth within the range. It is nothing more than a means of reducing positions within the range. Even if there is a risk of being trapped when entering the market at the upper or lower edge, it only happens once, and the overall winning rate is still high.
Even if there are upper and lower edges, this position will be confirmed by a pullback or a pullback. This is also the exit and right entry point.
(To understand this point, please combine it with the common forms of the disks I just drew below)
Take this issue’s real disk as an example:
Look at the picture below and you will understand why. I have been too determined to watch too much these days.
