Congestion

Congestion is a stock market term used to describe a price chart with sideways consolidation and periods of accumulation and distribution.

Congestion

Congestion is a stock market term used to describe a price chart with sideways consolidation and periods of accumulation and distribution. 


Identification of Congestion Periods

Congestion refers to a period of non-trending or sideways price movement, sometimes in an increasing narrow range, as in the case of triangle and pennants.

A symmetrical triangle could be considered to be a period of congestion.

A symmetrical triangle could be considered to be a period of congestion.

Interpretation of Congestion

Congestion represents a period of time where the market price  is essentially at fair value with no significant changes in supply or demand. 

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