![]() ![]() Understandably, the rising wedge needs to reverse an existing trend. There are several prerequisites for the formation of a rising wedge (in the context of a reversal pattern). The lines are constructed by connecting two or more separate highs and lows. The support line usually has to be a bit steeper than the resistance one. The support and resistance lines both point towards an upwards direction. These sloping lines are basically support and resistance levels that move in a converging pattern (the lower line is the support line, while the upper one is the resistance line). What is a Trailing Drawdown, and How Does it Work?Ī rising wedge forms when the price’s movement consolidates between two sloping trend lines collectively displayed as a triangle.Black Wednesday – How George Soros Tried to Crash the Pound.It is a preferred technical trading tool for many day traders.īesides, the indicator is considered very reliable and one of the best reversal patterns out there. ![]() The rising wedge pattern is widely spread within stock, futures, and FX markets. No matter whether it is a reversal or a continuation signal, in both cases, the rising wedge indicates increased bearish sentiment. However, the rising wedge pattern can also fit within the continuation indicators category. When the stock is in an uptrend, a rising wedge is an indication that a short-term pause before a bear market might be expected. ![]()
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