Definition of the Continuation

The reader is no doubt already sufficiently familiar with the difference between a
reversal and a continuation formation to make up his own definition of the latter.
The continuation, or intermediate, formation is simply an intermediate pattern
which interrupts temporarily the previous major trend, and forecasts continuation
of that preceding major trend when the formation has been completed.
The logical explanation for the occurrence of continuation patterns is perhaps not
so easily arrived at as for the reversal pictures. In the latter we observed how it was
quite natural to expect a period of hesitation a chart formation, a price area
during
the interval when the previous balance between buying and selling was being
reversed, with consequent slow reversal of the price trend.