![]() ![]() In a bullish trend what seems to be a Rising Wedge may actually be a Flag or a Pennant (stepbrother of a wedge) requiring about 4 weeks to complete. A rising wedge is more reliable when found in a bearish market. As far as volumes are concerned, they keep on declining with each new price advance or wave up, indicating that the demand is weakening at the higher price level. Prices usually decline after breaking through the lower boundary line. Definition: A Rising Wedge is a chart pattern within the context of an uptrend composed of two upward sloping and converging trendlines connecting a series. Although both lines point in the same direction, the lower line rises at a steeper angle then the upper one. That is to say that a rising wedge pattern can form near the terminal point of a bullish trend. In a rising wedge, both boundary lines slant up from left to right. Wedge patterns often occur at the terminal point of a trend. When this pattern is found in a downtrend, it is considered a bearish pattern, as the market range becomes narrower into the correction, indicating that the correction is losing strength, and that the resumption of the downtrend is in the making. The rising (ascending) wedge pattern is a bearish chart pattern that signals an imminent breakout to the downside. When this pattern is found in an uptrend, it is considered a reversal pattern, as the contraction of the range indicates that the uptrend is losing strength. The rising wedge pattern is characterized by a chart pattern which forms when the market makes higher highs and higher lows with a contracting range. ![]() Once prices move out of the specific boundary lines of a falling wedge, they are more likely to move sideways and saucer-out before they resume the basic trend. There comes the breaking point, and trading activity after the breakout differs. Volume keeps on diminishing and trading activity slows down due to narrowing prices. The upper descends at a steeper angle than the lower line. The rising wedge pattern develops when price records higher tops and even higher bottoms. ![]() In a falling wedge, both boundary lines slant down from left to right. They come in rising and falling variation and can occur in both an uptrend or a downtrend. When this pattern is found in an uptrend, it is considered a bullish pattern, as the market range becomes narrower into the correction, indicating that the downward trend is losing strength and the resumption of the uptrend is in the making. The wedge is a classic technical analysis pattern. When this pattern is found in a downward trend, it is considered a reversal pattern, as the contraction of the range indicat es the downtrend is losing steam. Rising (or ascending) wedges don’t just look like the opposite of falling ones. A market’s highs and lows form support and resistance lines that are both rising but point towards one another, indicating a period of consolidation. The falling wedge pattern is characterized by a chart pattern which forms when the market makes lower lows and lower highs with a contracting range. The rising wedge pattern is a formation that looks like the opposite of a falling wedge. ![]()
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