Rising Wedge Pattern on Gold: How It Breaks

What it shows

Both wedge lines, drawn from the first swing to the breakout candle with a light fill between them. A label sits over the middle of the wedge at its highest swing, and a dotted line leads to a Target label.

How Pravex works it out

1. Swings are read from the last 600 candles and no further back. To count as a swing high, a candle needs a high above each of the 5 before it and not below any of the 5 after it (lows are mirrored). So the newest swing is always at least 5 candles behind the live candle. When the same kind of swing turns up twice running, the more extreme one replaces the other.
2. A wedge uses four swings in a row, two highs and two lows. The upper line joins the first and last high, the lower line joins the first and last low.
3. Both lines must slope up, with the lower line rising quicker so that they converge. The channel at the end must be at least the Minimum squeeze share narrower than at the start. No close may go beyond a line by more than 2% of the end width.
4. Any later close below the lower line is the breakout. Unlike the triangle there is no apex limit, so a breakout many candles later still counts. Target: the lower line at that candle minus the starting width. Failure level: the higher of the upper line at the last swing and the highest swing; a high over it before the break drops the shape.
5. Once a candle has broken out, the target and the failure level race each other. Whichever a later candle touches first sets the status, Reached or Failed; a candle touching both gives Indefinable; with neither touched it stays Awaiting.

Settings

Setting	Default	What changing it does
Which patterns to keep	All	Limits the chart to patterns with a given status: all of them, only Awaiting and Reached, only Awaiting, or just the newest Awaiting one (Last Awaiting). The last choice shows only the setup that is still open.
Where targets are drawn	Only Awaiting	Which targets to draw: All, Only Awaiting, Awaiting and Reached, or None. Hover a target to read its price, the pattern’s name and its status.
Minimum squeeze	30	How much the channel must have narrowed, in percent of its starting width. At 30 the end is at least 30% narrower than the start. Raise it for tighter squeezes, lower it to accept looser wedges.
Show unconfirmed patterns	off	Leave it off to see completed breakouts only. Turn it on and unfinished shapes appear as well: the last leg is dotted, its end is the running extreme rather than a confirmed swing, and the target is where a breakout would aim.

How traders read it

A rising wedge is a rise running out of room: each leg up is smaller than the last. A close under the lower line is the trigger, and Pravex sets the target one starting width beyond it.

Suppose, purely as an illustration, the channel is 12 wide at the start and the lower line is at 105 when a candle closes under it. Subtract the 12 and the target sits at 93.

When it misleads

A rising wedge is also an uptrend with slowing legs, and the uptrend can simply continue; the shape is drawn only after the close below (unless unconfirmed patterns are shown). Because there is no apex limit, a break long after the shape formed is still drawn. The swings used are confirmed ones, which means a delay but not a guarantee. A more extreme swing of the same kind later on replaces the earlier swing and can move or erase the pattern, and a close through the line on the still-open candle may be undone before it closes.

Questions and answers

How is a rising wedge different from a bull flag?

A flag follows a sharp pole and drifts against it in parallel lines; a rising wedge slopes with the trend between converging lines and needs no pole.

Where is the rising wedge target?

The wedge’s starting width, taken from the lower line’s price at the breakout candle.

Which line decides a rising wedge?

The lower one. A close under it forms the pattern, while a high above the upper line or the highest swing before that drops it.

Is a rising wedge bearish on gold?

Pravex marks only the close below the lower line and a target; it makes no call on direction. A rising wedge can also keep rising until the lower line gives way, and the status shows Failed if price crosses the failure level instead.

Related: Falling Wedge Chart Pattern, Triangle Chart Pattern, Bearish Flag Chart Pattern, All Chart Patterns, every indicator.