Falling Wedge Pattern
A bullish pattern with converging downward-sloping trendlines—lower highs and lower lows that narrow, typically breaking upward.
Quick Answer
A bullish pattern with converging downward-sloping trendlines—lower highs and lower lows that narrow, typically breaking upward.
What Is the Falling Wedge Pattern?
The Falling Wedge is the bullish counterpart to the Rising Wedge. Price makes lower highs and lower lows within converging downward-sloping trendlines. Despite falling prices, selling pressure weakens as the range narrows. Falling wedges often appear as reversal patterns at the bottom of downtrends or as continuation patterns in uptrends. A breakout above the upper trendline confirms the bullish signal.
How the Falling Wedge Forms
- 1Two downward-sloping converging trendlines contain price
- 2Lower highs and lower lows with decreasing selling pressure
- 3Volume typically declines as the wedge narrows
- 4Pattern completes with breakout above upper trendline
How to Confirm the Pattern
Price Target Calculation
Measure the height of the wedge at its widest point and project upward from the breakout.
Best Timeframes for Falling Wedge
How to Trade the Falling Wedge
- →Identify potential bullish reversals at trend bottoms
- →Time long entries on wedge breakout
- →Set stops below the wedge lower trendline
- →Target measured move from wedge height
Common Mistakes to Avoid
Detect Falling Wedge Automatically
VaultCharts automatically detects Falling Wedge patterns on your charts. No manual analysis needed - the pattern is highlighted with entry zones and targets.