Element:

A a rectangle consists of a series of horizontal price fluctuations-sometimes called "trading area"-whose top and bottom can be defined by horizontal lines. In some chart forms, the upper and lower boundaries are parallel, but they are either slightly inclined upward or slightly inclined downward. As long as the deviation between the parallel boundary and the horizontal line is small enough, these shapes can be regarded as rectangles.

B. The rectangle describes the competition between two evenly matched groups. The price is played between two players like table tennis, but when one player can't catch the ball, the outcome is clear.

The distance between the upper and lower boundaries of the C rectangle should be wide enough, which is generally set at more than 8% of the stock price.

D. Confirming the breakthrough of rectangle requires huge turnover and closing price to break through the boundary of 3%.

Other information you need to know in practical application:

Almost like a triangle, with the extension of the rectangle, trading activities gradually decrease. Any development to the contrary is suspicious, unless it is temporary and short-term news fluctuation.

After the rectangle is broken, the price may return to the boundary line of the form, but it is rarely pulled back to the form again.

Rectangles are usually continuous, but long-term, weak and slow rectangles are likely to reverse once they appear in the bottom area of the price.

The safe minimum measurement rule of a rectangle is given by its width. The number of points that the price goes out of the form must at least reach the distance between the top line and the bottom line of the form itself. Of course, the price may be higher. Generally speaking, every time the lowest forecast is reached, there will be a rebound or fall back.

Support may be formed after the upper bound is broken, and pressure may be formed after the lower bound is broken. The rectangle itself has the function of support and pressure on the future price trend.

There are pictures on the following websites:

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