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RainRead About WEDGE PATTERN WHAT IS A FALLING WEDGE PATTERN? The falling wedge pattern is a continuation pattern formed when price bounces between two downward sloping, converging trendlines. It is considered a bullish chart formation but can indicate both reversal and continuation patterns – depending on where it appears in the trend. HOW TO IDENTIFY A FALLING WEDGE PATTERN The falling wedge pattern is interpreted as both a bullish continuation and bullish reversal pattern which gives rise to some confusion in the identification of the pattern. Both scenarios contain different market conditions which must be taken into consideration. The differentiating factor that separates the continuation and reversal pattern is the direction of the trend when the falling wedge appears. A falling wedge is a continuation pattern if it appears in an uptrend and is a reversal pattern when it appears in a downtrend. Continuation or (Reversal) Pattern: Identify an uptrend or (downtrend) Link lower highs and lower lows using a trend line. The two lines will slope downwards and converge Look for divergence between price and an oscillator like the RSI or stochastic indicator Oversold signal can be confirmed by other technical tools like oscillators Look for break above resistance for a long entry The Falling Wedge is a bullish pattern that begins wide at the top and contracts as prices move lower. This price action forms a cone that slopes down as the reaction highs and reaction lows converge. In contrast to symmetrical triangles, which have no definitive slope and no bias, falling wedges definitely slope down and have a bullish bias. However, this bullish bias cannot be realized until a resistance breakout occurs. While this article will focus on the falling wedge as a reversal pattern, it can also fit into the continuation category. As a continuation pattern, the falling wedge will still slope down, but the slope will be against the prevailing uptrend. As a reversal pattern, the falling wedge slopes down and with the prevailing trend. Regardless of the type (reversal or continuation), falling wedges are regarded as bullish patterns. #Watchlist #RAIN (D):-CMP 191.35 Looks Good For More Upsides :) #Disclaimer:-View shared is for educational purposes only. Conduct your due diligence before making any trading or investment decisions. #StockToWatch
NSE:RAINLong
by Charts_insiders
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SBILIFE#Watchlist #SBILIFE (W):- CMP 1294 Looks Good above 1300 For More Upsides :) Trading volume tends to drop off the longer congestion lasts. This is not always the case but is the general tendency. Volume tends to pick up when the congestion ends. The congestion is over when there is a breakout, typically on larger-than-recent volume, and the price moves outside the congestion range. During a congestion period, the price will move between support and resistance. When the price breaks above resistance or below support, it indicates that the buyers or sellers have overpowered the other side, respectively. Some investors will enter during congestion, assuming that the stock price will continue to rise after the congestion ends. This is more likely to be the case if the price was in an uptrend leading into the congestion period. Other traders may wait for the price to break out of the congestion before entering a trade. For example, they may buy if the price moves out of the congestion price range on high volume. #Disclaimer:- View shared is for educational purposes only. Conduct your due diligence before making any trading/investment decisions.
NSE:SBILIFELong
by Charts_insiders
2