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How to Trade the Consolidation Stock Indexes Chart Pattern

To trade consolidation stock indexes chart patterns in indices traders need to learn about the technical analysis of consolidation stock indexes chart pattern.



Consolidation Indices Trading Chart Patterns

Consolidation stock indexes chart patterns are stock indexes chart patterns with converging indices trend lines that form a indices price consolidation period.

The technical buy point from a consolidation stock indexes chart pattern is the upside breakout of indices price

while a downside breakout of stock indexes price is a technical sell indices signal.


Ideally, a market breaks out from a symmetrical triangle prior to reaching the apex of the triangle.


Indices Trend lines can be drawn connecting the lows and highs of the consolidation phase, the indices trend lines formed are symmetric and converge to form an apex.

A stock indexes price breakout should occur somewhere between 60-80% into the consolidation stock indexes chart pattern - triangle stock indexes chart pattern. An early or late breakout is more prone to failure, and therefore less reliable.

After a indices price breakout the apex forms support and resistance levels for the indices price. Indices Price that has broken out of the apex should not retrace past the apex. The apex of the consolidation stock indexes chart pattern is used as a stop loss setting area for the open Indices trades.


When these consolidation stock indexes chart patterns form we say that the Indices Trading market is taking a break before deciding the next direction to take.


These consolidation stock indexes chart patterns form when there is a tug of war between the buyers and the sellers and the stock indexes trading market cannot decide which way to move.

Indices Trade a Consolidation Pattern?

Indices Trade a Consolidation Pattern? - Technical Analysis Consolidation Indices Trading Chart Pattern?



However, this consolidation stock indexes chart pattern cannot go on forever and just like in a tug of war one side eventually wins, looking at the stock indices chart example explained and illustrated below see how the indices trading consolidation stock indexes chart pattern eventually had a indices price breakout and moved in one direction.

Sell Indices Trading Signal

Sell Indices Trading Signal



Buy Indices Trading Signal

Buy Indices Trading Signal

 

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