11. How to Trade the Wedge Chart Pattern Like a Pro Part 1 | Forex
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Practice these concepts with a free practice charting and trading account here: http://bit.ly/forex-demo1 Check out other videos in our free beginner course here: http://www.informedtrades.com/index.php?page=freetradingcourses And of course, don't forget to jump start your learning as a trader by registering as a member of our learning community: http://www.informedtrades.com/register.php VIDEO TRANSCRIPTION In our last lesson we looked at specific strategies for trading the Head and Shoulders Pattern and the Reverse Head and Shoulders Pattern, two chart patterns which we view as reversal patterns when they show up in the stock, futures, or forex markets. In this lesson we are going to look at a pattern called the wedge pattern, which is unique in the sense that it can be viewed as either a reversal pattern or a continuation pattern, depending on the shape of the pattern and whether it is located in an uptrend or a downtrend. The Falling Wedge: The falling wedge pattern is characterized by a chart pattern which forms when the market makes lower lows and lower highs with a contracting range. When you find this pattern in a downtrend it is considered a reversal pattern as the contraction of the range indicates the downtrend is loosing steam. When you find this pattern in an uptrend it is considered a bullish pattern as the market range becomes narrower into the correction indicating that it is running out of steam and the resumption of the uptrend is in the making. The Rising Wedge: The rising wedge pattern is characterized by a chart pattern which forms when the market makes higher highs and higher lows with a contracting range. When you find this pattern in an uptrend it is considered a reversal pattern as the contraction of the range indicates that the uptrend is loosing steam. When you find this pattern in a downtrend it is considered a bullish pattern as the market range becomes narrower into the correction indicating that it is running out of steam and the resumption of the downtrend is in the making. That's our lesson for today. You should now have a good understanding of the falling and rising wedge pattern and situations where they are considered a reversal pattern and situations where they are considered a continuation pattern. In our next lesson we are going to go over a strategy for trading rising and falling wedge patterns complete with entry and exit points and how to determine each.
Comments
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David, the way you explained it is very good, but your wedge at @2:38 looks like the triangle continuation pattern. Wedges and triangles confuse people though.
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Agreed, excellent video collection, love your work. Think you meant to say bearish instread of bullish trend around the 2.33 mark though? Had me confused for a little while...
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one of the Best Forex Channel for beginners where all types of trading figures and ways are previewed here as to taught and flourish the knowledge of importance in Forex. keep on going David!
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omfg the nose breathing!!!!
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Hi, may i ask what is the difference between continuation and reversal pattern?I find it hard to differentiate them in your presentation
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I know these are brief videos of technical analysis but how does wedge patterns and time relate. maybe a trading example of when to trade in and out of a wedge and are there targets like H&S patterns? thanks for the vid
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@dewi1142 I have free no loss Scalping indicator - much better than ur patterns
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Hey David, just want to let you know what you have uploaded on to youtube is probably one of the best things ever uploaded to youtube and very informative for anybody on any level of knowledge on markets. Absolutely amazing and simplified videos!
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chart patren is best
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Hey Dave, I am new to investing and have found your tutorials very helpful; however would you mind explaining where you draw the wedge lines. I am unclear with this... Are the lines support and resistance lines that just contract? Thanks again!!
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Hello David, thanks for your series of excellent videos.I am interested if you have any statistics on the various techniques that you mention.For example what percent of the time does a falling wedge lead to a trend reversal etc.?
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How about riding the pattern with a good entry point and with a stop just above/below depending on the course of the pattern?
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Okay my bad for the misunderstanding. Thanks for clarifying that! -Brendan
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Hey TheProphiting, This is one of Dave's older almost oldest videos. I think he has improved quite a bit from when he started, but I will forward your comment on to him. -Brendan
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who are u man...you know..nobody is compelling you to follow up. There are other videos in youtube..just get there out...leave us. we know how to trade/talk/walk and dump
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Hey Graveyard, if you can do better, why dont you show us.
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LOL... The Falling Wedge continuation pattern: continuation of the uptrend - yeah, after it retraces 100% of its uptrend! Personally, I wouldn't call that a continuation of the uptrend! In fact, when it got back up to its top, where it supposedly is continuing up from, it found resistance and turned back down! LOL...