This article has been translated from English to Gen Z Slang.
A rectangle is like when the price is vibin' between two parallel lines, aka support and resistance levels.
A rectangle is basically when buyers and sellers are in a standoff, throwing low-key jabs, but nobody's winning yet.
The price is gonna keep testing those lines, like "Are we there yet?" until it finally makes its move.After that, it might slide in the direction of the breakout, whether it's flexing up or dipping down.
As you can see up there, the pair was straight-up chilling between two key levels, just vibing parallel to each other.
Just gotta wait for the moment one of these levels yeets, then we ride that wave!Remember, when you spot a rectangle: THINK OUTSIDE THE BOX!
Bearish Rectangle
A bearish rectangle pops up when the price is catching its breath during a downtrend.
This happens 'cause sellers need a sec to chill before they take the price even lower.
In this example, the price got tired of that rectangle life and just dipped.
If we had a short order just below support, we'd be making bank on this trade.
Here’s a tip: Once the pair goes below the support, it usually yeets the same distance as the rectangle's size.
In the example above, the pair did more than just the bare minimum, so there was a chance to snag more pips!
Bullish Rectangle
Here’s another rectangle sitch, but this time, it's a bullish rectangle chart pattern.
After an uptrend, the price took a lil' break to consolidate. Can you guess where the price is headed next?
If you said up, then you nailed it! Peep that sweet upside breakout!
If we had a long order sitting pretty on top of resistance, we'd be cashing in those pips!
Just like in the bearish rectangle pattern, once the pair breaks, it usually moves AT LEAST the size of its previous range.
Do it look like I’m breaking out?