The Rising Wedge is a popular reversal pattern use by forex traders. Learn how to spot the rising wedge and how to trade it.
Rising wedges appear regularly in the financial markets and traders gravitate towards the pattern because of its simplicity in identification and application. This article will explain how to spot a rising wedge on forex charts and how to trade them.How to trade forex with the rising wedge patternThe forex rising wedge pattern is a powerful consolidation price pattern formed when price is bound between two rising.
The chart above shows a rising wedge ‘continuation’ pattern after a determined downtrend. The rising wedge is outlined by the blue dashed lines showing diminishing bull strength in the uptrend. Confirmation of the uptrend waning in strength can be seen using the volume tool on the chart which depicts fading volume in concurrence with the ascending price in the market. This is known as divergence, showing that the upward movement is coming to an end.
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