A **falling wedge pattern** is a bullish chart pattern in technical analysis. It forms when the price makes lower highs and lower lows, but the range narrows as the lines converge, creating a wedge shape sloping downward.
**Key Points:**
- **Bullish Signal**: Indicates a potential price reversal or breakout to the upside.
- **Structure**: Two converging trendlines—support (lower) and resistance (upper)—sloping downward.
- **Breakout**: Typically, the price breaks above the upper resistance line, signaling a bullish move.
- **Volume**: Often decreases as the wedge forms, then spikes on breakout.
- **Confirmation**: Wait for a breakout above resistance with strong volume for confirmation.
**Trading Tip**: Enter a long position after the breakout, with a stop-loss below the lower trendline. Target price is often the height of the wedge added to the breakout point.
Example: If Sahara stock shows a falling wedge, watch for a breakout above the upper trendline with high volume for a potential buy signal.
**Key Points:**
- **Bullish Signal**: Indicates a potential price reversal or breakout to the upside.
- **Structure**: Two converging trendlines—support (lower) and resistance (upper)—sloping downward.
- **Breakout**: Typically, the price breaks above the upper resistance line, signaling a bullish move.
- **Volume**: Often decreases as the wedge forms, then spikes on breakout.
- **Confirmation**: Wait for a breakout above resistance with strong volume for confirmation.
**Trading Tip**: Enter a long position after the breakout, with a stop-loss below the lower trendline. Target price is often the height of the wedge added to the breakout point.
Example: If Sahara stock shows a falling wedge, watch for a breakout above the upper trendline with high volume for a potential buy signal.
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Exención de responsabilidad
La información y las publicaciones que ofrecemos, no implican ni constituyen un asesoramiento financiero, ni de inversión, trading o cualquier otro tipo de consejo o recomendación emitida o respaldada por TradingView. Puede obtener información adicional en las Condiciones de uso.