Consolidation

Consolidation in technical analysis is the condition where the price settles down on a particular level without much movement. This scenario is the result of indecision from traders, at this point, the price is bouncing up or down from identified support and resistance levels. It remains dormant at a particular channel this is mainly caused by orders placed above or ahead the established support and resistance levels. The consolidation period ends if a major news is released or successive limit orders are triggered in a domino like fashion.


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