My understandings on Rectangle :


Rectangle = Range Bound (or Range Trading)


Rectangle at bottom of chart = collection

Rectangle at middle of chart = transition

Rectangle at top of chart = distribution


Which is which, you decide !!!

After the long formation, it will definitely breakout. The question is should it break up or down?

Normally, after a long rectangle, it should go back to where it comes from. Unless, it is at transition phase, the rectangle shouldn't be too long.

When you are not sure about the chart (should it break up or down?), flip the chart upside down, you will be able to see much clearer (always practice that).

Happy trading!!!