Rectangle/Descending TriangleThere is a Descending Triangle inside the Rectangle pattern.
The bottom trendline of the Rectangle is the also the support line of the Descending Triangle.
Both are neutral patterns until a trendline is broken with a confirmed trend in that direction.
One way to calculate targets for a triangle is to measure the width at the wide end then project it up or down at the level of the break.
Some would measure targets for a Rectangle by measuring the width and projecting it up or down from the broken trendline. I would use fib levels using this measurement but there are other ways to calculate targets. Since the width of the Rectangle is the same width as the wide end of the Descending Triangle, targets would be virtually the same for each pattern.
I hear defense is one the latest "defensive" buy from analysts. Analysts are often lagging indicators.
When LMT nears a level of resistance in this structure, candles of indecision appear.
Price is at a relatively important level of support today if it holds.
There is also a bearish Shark or a bearish Cypher in the Rectangle. It is kind of like in the middle but either way, it is a crooked W with valley 2 lower than valley 1. The 2nd leg retracement does not rule the Cypher out. I will leave it at that as it appears the 4th leg of the W has terminated.
Price is above the .382 of the trend up from the Covid low, which I have deemed a danger zone for any interest in going long and has actually become a good spot to begin looking at shorting a security. Catching stocks above the .236 in the current market is even better. (To be honest, I have not had any interest in going long lately no matter which fib level price is above or below)
No recommendation. Be safe up there. I have my white line drawn and ready to move using the magnet when the time comes. I will revisit this.
“Nothing is more frightening than a fear you cannot name.”
― Cornelia Funke, Inkheart
