Consolidation on Forex plays an important role. A correct understanding of the term allows you to think through your tactics well and earn a greater number of orders. In this article we will understand what is consolidation on Forex and how to apply it in practice. The essence of the consolidation phenomenon on Forex. How does it differ from the flat? The activity on Forex is accompanied by a mass of difficult terms that frighten beginners. If you deal with them, then every concept becomes simple and easily applied in any activity. One such term is "consolidation". This is a slowdown in the price movement after a significant change in the chart. Upon reaching the maximum or minimum, the cost can suddenly reduce the speed of movement. This should be taken into account for proper strategy planning. Knowing the possible trend activity, the analyst is more likely to anticipate the course of the situation, and increase the capital. Use the training materials hqbroker.com and become a successful trader with our team. The reason for the sharp change in the rate is considered to be significant economic incidents, to which the market reacts. Depending on the currency pair, such factors may be a sharp increase or decline in GDP, a crisis in one of the states or a fall in the level of harvest and so on. The value of the asset quickly responds to the event, but the rapid advance to one side cannot last without end. Anyway, the price starts to be negatively perceived by one of the participants, after which it should be revised. The rollback of the trend to other positions is due to a reduction in the number of transactions and a reduction in trading volumes. At a certain point, the course reaches its optimal value, when sellers and buyers come to a common consensus. The moment of achieving such a favorable position is called consolidation. During this period, the cost can vary within a few points. A pronounced direction is completely absent. The phenomenon is much like a flat. The main difference of consolidation is that it comes only after a sharp price movement. In these moments, it is worth opening orders in new directions of the trend. At the same time, the flat can be seen at any time, regardless of the rapid change in price. The moment when the schedule comes out of consolidation, many experts consider as a weighty trading signal. This is a time of profitable entry into the market and the opening of profitable trades. As a rule, the intersection of the consolidation zone shows the direction of the price, which will persist for some time. By tracking the chart, you can more or less predict the market situation. Read the reviews of hqbroker.com to know all the latest market events. Use company’s accurate trading signals and charts to increase your trading experience.