Descending Wedge Definition - Glossary

Descending Wedge is a bullish chart pattern indicating a potential price reversal as the trend narrows downward.

Descending Wedge is a technical analysis pattern characterized by converging trendlines sloping downwards. It typically signals a bullish reversal. The price moves between two downward sloping lines that converge over time. Volume generally decreases as the pattern forms, indicating weakening momentum. The breakout occurs when the price breaks above the upper trendline. Traders view this as a signal to buy, anticipating a potential upward price movement. The pattern's reliability increases with higher time frames and volume confirmation. Recognizing a Descending Wedge helps traders capitalize on potential market reversals in both crypto and traditional financial markets.