Group: Reversal
Description: A narrowing upward-sloping channel, often preceding a bearish reversal.
Key Characteristics:
- Higher highs and higher lows
- Converging trendlines
- Declining volume
Trading Logic: Sell on breakout below support. Stop-loss above the last high. Target equals the wedge’s height.
Example: Often forms at the end of strong bull markets.
Conclusion: A frequent signal of trend reversal to the downside.
