Your job as a trader is to patiently wait and only enter once the breakout occurs. Often times, a breakout of either of the two trendlines will lead to a volatile directional move. More than simply being a reversal pattern, this can also be traded as a continuation pattern. This pattern can appear at the end of a bullish trend as well as at the end of a bearish trend. There are many opportunities to trade the symmetrical wedge pattern. One upward support trendline that connects a series of sequentially higher lows.Īt some point in the future, the two trendlines that connect the highs and the lows will meet together at the right side of the pattern.One downward resistance trendline connects a series of sequentially lower peaks.This is identified by drawing two trendlines: It can be recognized by the distinct shape created by two diverging trendlines. The symmetrical wedge pattern has the shape of a symmetrical triangle. It is constructed much the same as the falling wedge pattern. The symmetrical wedge pattern is another simple price action pattern. We also have training for the best short-term trading strategy.īefore jumping into the rules of wedge trading strategies, we still need to define our second favorite pattern the symmetrical wedge pattern. We can definitely say there are some characteristics in common between a falling wedge pattern and a bullish flag pattern but the difference is that the flag pattern is more of a short-term aggressive pattern while a wedge pattern is more of a long-term price action. The falling wedge pattern is not confirmed until it’s breaking to the upside resistance. And at some point in the future, the two trendlines that connect the highs and the lows will converge. While the falling wedge pattern develops, you’ll notice the length of the swing waves become tighter and tighter. However, as we approach the end of the falling wedge pattern you’ll notice the price will fail to make lower lows. Each lower point should be lower than the previous lows and each higher point should be lower than the previous high.Ĭheck out this article on a step-by-step guide to a chart pattern trading strategy! You need to have a series of lower highs followed by a series of lower lows, the more the better. Now, how to recognize the price structure of a falling wedge pattern? Falling wedge pattern
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