Rectangle Pattern

Learn to recognize and trade a rectangle pattern through interactive charts.

This blog is reader-supported. Please open a trading account through our links to tip us. Affiliate commissions keep our reviews impartial and ad-free.

What is a rectangle pattern?

A rectangle pattern is a consolidation pattern in a trend, which could be either up or down. This is why it's advisable to wait for a breakout to determine the direction of the next significant move in prices.

Interactive charts:

Download our free chart patterns PDF for a guide to 20 classical chart patterns with over 100 interactive charts, also on

Rectangle pattern duration

A rectangle usually develops over a 3-month period, although some can take longer. The longer it takes for the pattern to form, the bigger the move you can expect in either direction.

Rectangle pattern characteristics

A rectangle consists of two parallel lines that define a trading range.

  1. This pattern is a consolidation in a trend, which could be either up or down.
  2. The parallel trendlines must run through at least 2 lows and at least 2 highs. The more touchpoints, the stronger the pattern.
  3. These highs and lows should alternate in a wave-like fashion, and be relatively evenly distanced from one another.

Trading volumes

Unlike triangles, flags or pennants, there is no expectation that volumes decline as the pattern forms. As always, look for a rise in volumes upon a breakout, in order to validate the pattern and the likely future price trend.

Rectangle pattern trading tips

A breakout occurs when the price either breaks through resistance, or falls through support. The breakout should occur on higher volumes. Some traders wait for a successful re-test of that line before opening a position.

In the event of a rise in price above the resistance line, this means waiting for resistance to become support. The opposite holds true in the event of a fall in price below support.

Related articles

Featured Brokers


MT5 Floating - Market Execution

Trade 70+ currency pairs, indices, energies and metals on floating spreads with market execution. ... More

  • $500 deposit
  • 1:200 leverage
  • 1.51 pips EUR/USD
  • Regulators: Bahamas, Cyprus (EU), South Africa, UK
Risk warning: 84.69% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs and Spread Betting work and whether you can afford to take the high risk of losing your money.

Standard Account

Trade CFDs on thousands of markets across Forex, crypto-currencies, stocks, indices and commodities... More

  • $20 deposit
  • 1:100 leverage
  • pips EUR/USD
  • Regulators: Australia, Belarus, Cyprus (EU), Saint Vincent and the Grenadines, Seychelles, UK
Risk warning: CFD trading is a risky activity and can bring not only profit but also losses. The size of the potential loss is limited to the size of the deposit. Past profits do not guarantee future profits.


Standard Account

Trade 74 currency pairs and CFDs on stocks, oil, metals and crypto with leverage up to 1:500. 4XC ... More

  • $10 (MT4), $ 100 (MT5) deposit
  • 1:500 leverage
  • 1.4 pips EUR/USD
  • Regulators: Cook Islands
Risk warning: Trading Forex/CFDs on margin carries a high level of risk and may not be suitable for all investors as you could sustain losses in excess of your deposits. You should carefully consider your financial situation and experience level before trading.