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Wedgebreakout

What are Falling and Rising Wedge Patterns?What Is the Wedge Pattern and Its Common Characteristics? 1. Wedge patterns have converging trend lines that come to an apex with a distinguishable upside or downside slant. a. Wedge with an upside slant is called a rising wedge b. Wedge with downside slant is called falling wedge 2. It has declining volumes as the pattern progresses 3. It breaks out from one of the trend lines Why We Should Pay Attention to Wedge Patterns? Some studies suggest that a wedge pattern will breakout towards a reversal rather than a continuation more often than two-thirds of the time. Therefore as the rule of thumb, people generally treat a falling wedge as a bullish pattern and a rising wedge as a bearish pattern , especially a falling wedge would be a more reliable reversal indicator than a rising wedge Since we know a wedge pattern has a higher probability to reverse and due to the fact that the price of wedge pattern converges to a smaller area, we can trade the reversal set up with a relatively close stop loss to its entry price, which provides us with a good trading opportunity with a decent Risk:Reward ratio. Examples of a Bullish Rising Wedge and Bearish Falling Wedge Sadly, there is nothing that works 100% in trading. Not every rising or falling wedge will reverse as one might expect. Every trader must properly manage their risk by setting stop losses and not just trading based on price patterns. Below are two examples. Bullish Rising Wedge ( ETHUSDT during 15/NOV/20 - 28/DEC/20) In the early stages of the epic 20-21 bull market, if traders blindly treat the rising wedge as a bearish signal and trade accordingly, they would pay a heavy price. Bearish Falling Wedge ( LTCUSD during 14/AUG/18 - 14/NOV/18) On the contrary, in the late stage of the 2018 bear market, any trader who blindly trades the falling wedge to bet on a reversal would also learn a hard lesson. Comment down your thoughts on Wedge Patterns in the comment section. Disclaimer: This is just an educational post. Never trade just any pattern. And please do your research before making any trades. Happy Trading!
Education
by Coinlog
4
PETRONET - Falling Wedge BreakoutThe stock was in a downtrend with contraction between the upper and bottom resistance lines, forming a wedge pattern. It has broken out of the pattern with substantial volumes. Position can be taken near current price, keeping the stop loss near 216 levels, for a short term target of 232.5. Please follow us for more trading setups like these. If you have any queries/suggestions related to above pattern, feel free to type below in the comment section. Do show your love by pressing the like if you liked the idea.
NSE:PETRONETLong
by Yes2Profits
Multi-year breakout in BHARTIAIRTEL.Multi-Year Breakout and also Ascending triangular pattern breakout with huge volume can be seen in monthly timeframe chart which makes the trade's success probability very high, would suggest to go long with the buy on dip till 600 level for the Ultimate Target of level 820 (FIBONACCI IS CONSIDERED WHILE DECIDING THE TARGET), go long with strict stop-loss of 520 (only on closing below basis). the timeframe for this trade/target would be 12-14 weeks. THIS VIEW OF MINE IS PURELY BASED ON THE TECHNICAL CHART, BEWARE OF NEWS AND OTHER FACTORS WHICH CAN AFFECT THE MARKET SENTIMENT.
NSE:BHARTIARTLLong
by Ankushkokane
WEDGE-BREAKOUT-UPTREND-PRICE-ACTION-VOLUME-PROFILEDisclaimer-: 1. FOR WHOM VOLUME PROFILE AND MY METHOD IS A LITTLE NEW OR BLURRY . I WILL SOON PUT UP AN EDUCATIONAL POST WITH DETAILS AND EXAMPLES. WE CAN HAVE A SERIES OF DISCUSSIONS THERE TOO. DO FOLLOW MY ACCOUNT TO GET NOTIFIED. 2. Do ask your questions in the comments if any. Volume Profile-: In volume profile we can compare the levels of volume at different price levels historically and current price levels to try to find the strength of current move and strength of the resistance it might face. If the up-move (currently) and its previous accumulation's volume is very high compared to the volume of its historical resistance level it means we have more strength in up-move and weak resistances can be crossed. IMPORTANT OBSERVATIONS-: 1. Stock was declining for a while. 2. Gave a nice falling wedge or triangular pattern breakout and started rising. 3. Recently accumulated over a range and then gave a breakout. 4. Has retraced a little with low volume and thus has given us an opportunity to enter with confirmation. 5. The volume of the accumulation level is too high compared to the volume at its all time high, which shows its a weak resistance level and there is a high chance it will be broken. TARGET WITH LOGIC: Since all-time-high has a weak resistance we might make a target farther than the all time high. Since the up-move is strong and accumulation has nice volume. So a Fib Extension target of 168% makes sense since , since the rally started the recent accumulation has more volume than ever before so the current expected up-move should be more than the previous rally. So 168% MY APOLOGIES-: Of course the best entry would have been after breakout of the wedge pattern with confirmation but I had not come across the stock at that time due to my negligence. (See my other recent posts, some of them have recently given wedge breakout with good opportunities) ENTRY and STOP-LOSS Entry at CMP above 90 level with a conservative stop-loss at the support of accumulation which is at 65 would be better than an aggressive stop-loss. Enter only if next time the entry price gives a reasonable RR ratio as per your strategy. Keep trailing stop-loss. One of the ways is to use Moving Average with Average True Range(14) (ATR) as buffer. EXIT IF there is bearishness near the all time high, a trailed stop-loss should be at place and obeyed. Since the target is above all time high. Its a provisional target level. So it doesn't make sense to exit at target rather hold on to it as much as possible and keep trailing stop-loss. Following can be used as exit signals or bearishness signals. 1. If there is bearish candlestick pattern in 1W timeframe, stop-loss can be trailed to a nearby support level .(Like Candle Low) 2. If there is RSI Divergence in 1W timeframe, better to exit at close of 1W since afterwards there can be long consolidation or reversal. 3. If the trailing stop-loss is hit, please exit **IF YOU LIKE MY ANALYSIS, KINDLY GIVE A THUMBS-UP AND SHARE IT IF POSSIBLE, HELPS A LOT :) **I WILL POST NECESSARY , SIGNIFICANT CHANGES IN THIS THREAD LIKE ADDITION TO POSITION, EXIT SIGNALS ETC. TO AVOID MISSING OUT ON UPDATES PLEASE REMEMBER TO FOLLOW THE POST AND MY ACCOUNT. **YOU CAN TURN ON NOTIFICATION TO BE UPDATED OF CHANGES **ANY COMMENT ON THE ANALYSIS WILL BE HIGHLY APPRECIATED.
WLong
by VPA_TRADER