Wedges

• A sloping trend line is called a wedge, however, both trend lines will slope instead on one of the lines being horizontal.
• When an ascending wedge occurs it indicates that there are more participants in the market selling and often indicates that any upward momentum will begin to slow.
• Breakouts that occur in wedges, always follow the opposite direction of the original move. They can be easily identified by a retracement that begins lower than the previous peak.
• It should be noted that many major market trends have ended with either an ascending or descending wedge.

The Two Types of Wedges:

1. Ascending wedge
2. Descending wedge

Ascending Wedges

Descending Wedges