Falling Wedge Pattern Definition - Glossary

Falling Wedge Pattern is a bullish reversal pattern in technical analysis. It signals a potential price breakout upwards.

Falling Wedge Pattern is a chart pattern that occurs when price action is bounded by two converging downward-sloping lines. It's characterized by a narrowing formation, where the slope of the lower trendline is steeper than the upper trendline. This pattern suggests that bearish momentum is weakening and a bullish reversal may be imminent. Traders look for a breakout above the upper trendline as confirmation of this reversal. It is often seen as a continuation pattern in an uptrend or a reversal pattern in a downtrend.