What is the Falling Wedge-Rising Wedge Formation that Lights the Torch of Great Rises and Falls?
Wedges are divided into two: Descending Wedge and Rising Wedge. Descending wedge-wedge formation is the name given to a pattern that is frequently encountered in price movement analysis and has a high working rate. This formation indicates that the trend may continue or reverse depending on the break in the current price movement. For this reason, it is called wedge or wedge.
The descending wedge pattern can also be seen in bull markets and bear markets. In bull markets, the price is usually expected to break above the wedge and make new higher highs. In a bear market, it is expected that a descending wedge formation will be seen, the downward trend will end for a certain period of time, and after the wedge breaks upward, the price will rise to the point where the wedge formation begins.
When determining the target point of the descending wedge, the channel length is taken and evaluated together with the place where it breaks, resulting in a specific target point. Rising Wedge-Wedge Formation is one of the formations frequently encountered in Bull Markets and Bear Markets. Seeing it in Bull Markets can tell us that the Bull Market has weakened and after the Rising Wedge breaks downwards, the Market will transition to the Bear Market.
Seeing this formation in Bear Markets may enable us to predict that the correction rise in the Bear Market has ended and new lows are now sought. The target point of the Rising Wedge is similar to the target point of the Descending Wedge. The channel length is taken and a movement equal to the channel length can be expected in the direction of the break.
