• 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

Rising Wedge

Ascending Wedge

Descending Wedges

Falling Wedge

Descending Wedge