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What Is a Rectangle Pattern

A rectangle is a sideways stretch where the highs keep stopping at one level and the lows at another, so the price moves back and forth inside a box with flat edges. This paper shows you a real one drawn from eight weeks of gold, the box it is named for, the rectangle on the daily chart with its touches and the close that left it, its height as one number, and the Fractals indicator that marks the touches on your platform.

Difficulty
Intermediate
Reading time
5 min
Pages
8
Reviewed by
Saman Rahbar

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A lid and a floor

A rectangle is a sideways stretch with two flat edges. From late November 2024 to mid-January 2025 gold moved back and forth between a lid near 2726 dollars and a floor near 2583. It touched the lid on 25 November, 12 December and 10 January, and the floor on 26 November, 19 December and 30 December, and every day in between closed inside the box. On 21 January a day closed above the lid, and the box was over. Eight weeks of highs stopping at one level and lows stopping at another.

The name

The name is the outline: a box. The lid is a level where the highs keep stopping, the floor a level where the lows keep stopping, and the price bounces between them. Neither edge slopes, which is what separates a rectangle from the other shapes on this shelf. A channel leans, a triangle narrows, a wedge does both. A rectangle is as wide at its end as at its start, because both of its lines are flat.

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