Rectangles

Triangles  Triangles Symmetrical broadening wedge  Symmetrical broadening wedge
Descending wedges  Wedges Broadening wedges  Broadening wedges
Flags and pennants  Flags and pennants right-angled broadening wedge Right-angled broadening wedge
Head and shoulders  Head and shoulders Double tops  Double (or triple)
 tops (or bottoms)
Rectangle  Rectangles cup with handle  Cup with handle

 

Rectangles

The rectangle is a forex price consolidation chart pattern. It can end in a continuation of the initial trend or a reversal of the trend. In a rectangle, the currency prices fluctuate within a horizontal channel, which suggests that supply and demand forces are equal. The pattern ends when the price crosses either the support or the resistance level.

The first profit target equals the distance that separates the two lines of the channel. Forex traders can wait for a pullback, which occurs frequently after one of the channel lines has been broken through in order to trade the continuation of the movement.