Rising wedge is manifested that the boundary lines are slanted upward with the lower line being line at a steeper angle than the upper line. The rising wedge implies a situation that is growing weaker from a technical perpective. When prices break through the lower line of a rising wedge, they usually fall in earnest.

        A SELL signal is confirmed by the price breakouts below the lower line of rising wedges are more reliable in bear markets than in bull markets.

        Trading volume in rising wedge gradually diminishes as prices move toward the apex of the wedge and then increases on the breakout point.

Examples of Rising Wedge:

EMAS INDEX RISING WEDGE / ASCENDING WEDGE

MMM-WA

TELEKOM

MIECO-WA 

Falling wedge

        Falling wedge is manifested that the boundary lines are slanted down and the upper line is at a steeper angle than the lower line. The falling wedge typifies a situation that is getting stronger from a technical perspective.

        A BUY signal is confirmed when prices break through the upper boundary of a falling wedge, they tend to move sideways for a period of time before beginning to increases. Breakouts normally occur at least two-thirds of the way to the apex of the converging boundary lines.

        Trading volume in rising wedge gradually diminishes as prices move toward the apex of the wedge and then increases on the breakout point.

Examples of Falling Wedge:

BJLAND

COMMERZ 

Copyright © 1997- 2005 Straits Index (M) Sdn Bhd. All rights reserved.