SubscribeCongested and Continuation Patterns
July 22nd, 2006 • Related • Filed Under
Congested and consolidation patterns are easy to spot. When a stock trades and moves in an irregular pattern, it is said that the stock is congested. We do not want to a stock when it is behaving in such a manner. The second that investors trade a stock with uncertainty, the market shows us her sense of humor as foolish investors are taken to the cleaners.
On the other hand, when a stock seems to trade in a sideways and orderly fashion, it is said that the stock is consolidating. The longer a stock trades in this pattern, the more powerful the breakout in which ever direction it goes. In this chart you will be able to see an example of when a stock trades in either pattern.
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