![]() The buyers manage to make the price rebound on the support line but lose control after the formation of a new highest point. The divergence of the two lines in the same direction (increase in price magnitude) informs us that the price continues to increase with movements that are increasingly high in magnitude. This implies that the ascending broadening wedge pattern is considered valid if the price touches the support line at least 3 times and the resistance line twice (or the support line at least twice and the resistance line 3 times).Īn ascending broadening wedge does not mark the exhaustion of the buying current, but the sellers’ ambition to take control. NB: a line is said to be "valid" if the price line touches the support or resistance at least 3 times. The upper line is the resistance line the lower line is the support line.Įach of these lines must have been touched at least twice to validate the pattern. It is formed by two diverging bullish lines.Īn ascending broadening wedge is confirmed/valid if it has good oscillation between the two upward lines. Typically, the falling wedge pattern precedes an upward reversal, presenting potential opportunities for buyers to consider.An ascending broadening wedge is a bearish chart pattern (said to be a reversal pattern). This pattern forms when the price creates lower highs and lower lows, forming converging trendlines. When a falling wedge pattern emerges within a downtrend, it indicates a potential reversal in the market. What is the falling wedge in a downtrend? Traders often see this pattern as a sign to consider buying positions in the market. This pattern is recognized by a series of lower highs and lower lows in price compared to previous movements. When a falling wedge pattern is seen during a downtrend, it may indicate a possible change to an upward trend. ![]() The wedge pattern has two types: rising wedge signals a potential downward trend reversal (bearish), while falling wedge suggests a possible upward trend reversal (bullish).
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