CADCHF Falling Wedge ReversalFalling Wedge formed from Feb 1st to Feb 20, testing the bottom 3-4 times and the top 5-6 times, proving validity.
Buying breakout of orange resistance level.
Falling Wedge
The Falling Wedge is a bullish pattern that begins wide at the top and contracts as prices move lower.
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.
Bullish confirmation of the pattern does not come until the resistance line is broken in convincing fashion. It is sometimes prudent to wait for a break above the previous reaction high for further confirmation. Once resistance is broken, there can sometimes be a correction to test the newfound support level.
While volume is not particularly important on rising wedges, it is an essential ingredient to confirm a falling wedge breakout. Without an expansion of volume, the breakout will lack conviction and be vulnerable to failure.
from: stockcharts.com
