In this article, we will look at how to identify and trade this pattern. As the pattern narrows, the price action becomes more compressed, eventually leading to a breakout that can result in a significant move in the opposite direction.
This pattern is formed from a series of higher highs and higher lows in an ascending wedge or lower highs and lower lows in a descending wedge.
The wedge pattern is a popular chart formation that traders use to identify potential reversals in the markets.
