Consolidations happen either during trending market phases or before a new trend. There are different consolidation patterns as we will see later: sideways ranges, wedges, double/triple tops or triangle shaped consolidations, just to name a few.
All consolidations represent a period in which the markets pause, where indecision about the next price move exist and where traders position themselves for the next move. Consolidation periods are necessary for accumulation and distribution as well because the “big” players use those to get into their larger positions