RANGE PATTERN
Rectangle range
Repeated acceptance between approximately horizontal boundaries.
Rules visible before the outcome
- Two or more tests of each boundary
- Width exceeds costs and minimum volatility
- No sustained close outside the range
02 / CONFIRMATION
When the idea becomes eligible
Boundary rejection for mean reversion or a close outside for breakout; never mix the two hypotheses.
03 / INVALIDATION
What proves it wrong
Beyond the boundary for a fade, or back inside for a breakout.
The attractive mistake
Ranges eventually transition, and repeated fading can concentrate loss on the breakout.
Make it falsifiable
Separate early, mature and late range observations.
1Freeze the geometry
2Timestamp eligibility
3Count every outcome
4Test unseen data