Today we’ll talk about the “Wedge” Pattern👨💻
This trading pattern “squeezes” the chart between two lines – a support line and a resistance line. Within the lines, the price can go up and down several times; a breakthrough is considered to be the chart exiting below the support line or above the resistance line. In the first case it is a sale, in the second it is a purchase.
Rising wedges are bearish signals that develop when a trading range narrows over time but has a clear upward slope. This means that, unlike ascending triangles, both subsequent lows and subsequent highs in a wedge pattern will rise as the trading range narrows towards the top of the wedge.
Descending wedges are the opposite of rising wedges and are always considered bullish signals. They develop when a narrowing trading range has a downward slope so that subsequent lows and subsequent highs within the wedge fall as the trade progresses.
#EducationalPost
