103-21 Continuation Patterns

Continuation patterns occur during a price move and are visual representations of consolidation or periods of rest before the price continues its trend, be that upwards or downwards.

103-21 Continuation Patterns - 1

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All of these triangles are essentially continuation patterns. They should give you some confidence that the trend will continue.  Always be aware that if the price breaks out in the wrong direction due to a shock (e.g., bad earnings or bad news), you should be prepared to act.103-21 Continuation Patterns - 2

A very common continuation pattern is the Rectangle, or more commonly known as a” “channel” or “trading range.”  The price should typically break out in the same direction as the previous trend.

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