After the storm of sharp up move, comes the consolidation period which is characterized by small downside pressure with in a tight narrow range as show in chart attached above. This consolidation phase is driven on the back of declining volumes. Next stage is breakout on the upside as continuation of the prior trend.The last stage is a breakout from the consolidation zone as continuation on the trend established prior to consolidation. Even this last stage can be as furious and fast as the breakout witnessed during the formation of the prior Flag pole marked before consolidation. The length and ‘likely targets’ for the 2nd Flag pole could be as big as the price movement witnessed during the 1st Flag pole.
0 comments:
Post a Comment