Wedge

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7 min read

Updated 2026-07-13

Reviewed by SST Editorial

A wedge is a pattern characterized by two converging trendlines drawn across highs and lows that both slope in the same direction (either both upward or both downward). A rising wedge slopes upward and is typically a bearish structure (either a reversal of an uptrend or a continuation of a downtrend). A falling wedge slopes downward and is typically a bullish structure (reversal of a downtrend or continuation of an uptrend). Confirmation occurs on a break out against the wedge slope.

Key Takeaways

01.Converging trendlines sloping in the same direction (rising or falling).
02.Rising wedges indicate exhausting buying pressure (bearish bias).
03.Falling wedges indicate exhausting selling pressure (bullish bias).
04.The pattern confirms when price breaks out in the opposite direction of the wedge slope.

Why it matters

Wedges signal a loss of momentum as the range tightens: in a rising wedge, highs are made at a slower pace than the rising lows, indicating weakening demand. This divergence often precedes a sharp, high-volume breakout in the opposite direction.

When it matters

Wedges are highly effective on daily or weekly charts to identify mature trends that are ripe for reversal.

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Visual Reference: diagram

A wedge structure with both support and resistance lines converging while sloping in the same direction.

Interactive Tool: terminal-embed

Plot converging support and resistance lines to identify if the wedge is rising (bearish) or falling (bullish).

Common Mistakes

Confusing wedges with channels

A parallel price channel slopes in the same direction but doesn't converge. Wedges must have converging lines, showing contracting volatility.

Failing to wait for the breakout close

Wedges are prone to intra-day spikes that test the boundaries. A breakout must be confirmed by a daily close outside the lines.

📖 Real-World Example: Falling wedge reversal at a market bottom

In late 2022, a major index formed a massive 9-month falling wedge. The price made lower lows, but the selling momentum slowed down, causing the lows to compress. The breakout above the upper boundary of the wedge marked the beginning of a sustained bull market.

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