Forex Falling Wedge Chart Pattern:
Forex falling wedge chart pattern is a bullish pattern. This is similar to the rising wedge but it occurs in a down trend. Like the rising wedge falling wedge pattern also consists of two trend lines joining the low and high points which converge.
Check the following picture. In the following picture a falling wedge is shown. Two trend lines are drawn joining the low points and high points and they are converging and meeting at some point.
Forex falling wedge pattern
Trading falling wedge:
Enter trading when the break out occurs. Like in rising wedge patterns, whenever a breakout occurs most of the times the price retraces back to the upper trend line. So use a stop loss of 5 to 10 pips below the lower trend line or below the last low point. If you use stop loss just below the upper trend line, the trade may reverse back and hit the stop loss.
Check the following real time examples so you can understand clearly how to trade the ascending wedges.
AUDNZD falling wedge:
The following is the four hour chart of AUDNZD and you can see a falling wedge for this. Once the break out occured you can enter trading. Or you can wait for the retracement and enter in the retracement.
AUDNZD four hour chart falling wedge
Take profit limit:
You can use the same methods I mentioned in the rising wedge chart pattern article. You can check it at the followoing location.
http://www.forexbees.com/forex-rising-or-ascending-wedge-pattern/
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