As a result, the lower line serves as support, and the price consolidation within the narrowing range form a coiled spring effect, eventually resulting in a sharp move on the upper side. As the pattern matures, new lows contract because the selling pressure reduces. Contraction: The range’s contraction indicates decreasing market volatility.Volume: Volume decreases as the channel progresses.However, the higher the number, the greater the likelihood of a market reversal. At least two spots should be connected by each line. They eventually intersect on a converging point called the apex. One connects the lower lows, and the other connects the lower highs. Trend lines: There are two converging trend lines.
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