#Rising wedge pattern youtube how to#

As you probably understand, we assume that the breakout will occur in the downward direction, as that would signal that the market is taking off and is headed down. The last part of the rising wedge pattern is the breakout that appears at the end. As such, it’s reasonable to expect that markets stand a higher chance of turning around soon. This simply shows that fewer and fewer market participants are ready to step in as the market gets higher. VolumeĪccording to the original definition, it’s preferred to see the volume decline as the pattern advances into the wedge. However, if the resistance line (the upper line) isn’t rising as fast as the support line, it tells us that the bullish forces don’t have quite the strength it takes to push the market to make higher highs, which some choose to regard as a bearish sign. As you might expect, both these lines should be sloping upwards, and converge so that the distance traveled by the market gets smaller and smaller the further it moves into the wedge.Īccording to the original definition of the pattern, you like to see that both lines converge with the same slope. 1.The support and resistance linesĪs the wedge forms, you should be able to draw a resistance line that connects the highs, and a support line that connects the bottoms. Below we have broken down the definition of the pattern, and the various conditions you need to take into consideration. Rising Wedge ExampleĪs to the definition of the pattern, it closely resembles a wedge that has both its lines rising, as you see in the image above. Let’s start! What Is a Rising Wedge? : Definition and meaningĪs said the rising wedge is a bearish pattern that usually signals the end of the current bullish trend, or the continuation of the bearish price moves, depending on the direction of the preceding trend. A short introduction to the falling wedge pattern.How the rising wedge compares to triangles.Some techniques you can use to improve the performance of the pattern, and avoid false breakouts.

#Rising wedge pattern youtube how to#

This includes where and how to place the stop loss and profit target Exact rules outlining how many traders choose to trade the pattern.The psychology behind the rising wedge pattern.The exact definition and meaning of the pattern.This article is going to look closer at the rising wedge pattern, and the things you need to know in order to start trading it.