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Wedge
A wedge is basically a sloping triangle, however instead of one of the trend lines being horizontal both trend lines are sloping. In the case of an ascending wedge this suggests there are more participants selling and tends to suggest a loss of upward momentum. The breakout from a wedge is always in the opposite direction to the original move. This can be identified by a retracement that starts lower than the prior peak.
It should be noted that many major trends have come to an end with an ascending or descending wedge.
There are two types of wedges:
- Ascending wedge
- Descending wedge
Ascending wedge
Descending wedge
