Buy mentha oil 930 -925 stoploss : 905.00

Menthaoil ~ Rising Wedge pattern Target 896 – 875 [vimalraj]

Menthaoil ~ Rising Wedge pattern Target 896 - 875 ???

Menthaoil only sell below 926.00

Now Menthaoil forming Rising wedge pattern as per this pattern
Menthaoil Target 896 - 875 .....

Stoploss :951.00

Note :- This is my personal view only,take positions with your own analysis...

Rising Wedge

The rising wedge is a bearish reversal pattern formed by two converging upward slants. To confirm a rising wedge, there must have oscillation between the two lines. Each line must be touched at least twice for validation.

This pattern marks the shortness of buyers. This one is characterized by a progressive reduction of the amplitude of the waves. The lowest reaches during the first correction on the resistance of the wedge will form the support. A second wave of increase will then occur, but with lower amplitude, which make appear the weakness of buyers. A second wave is formed thereafter but prices will increase less and less at the contact with the support. Volumes are then at their lowest and gradually decrease as the waves. The movement then has almost no buying power which indicates the willingness of a bearish reversal.

The target price is given by the lowest point that resulted in the formation of the wedge.

Here is a graphical representation of a rising wedge:


Forex Statistics

Here are some statistics about the rising wedge:

- In 82% of cases, there is a downward exit
- In 55% of cases, the rising wedge is a reversal pattern
- In 63% of cases, the target of the pattern is reached once the support broken
- In 53% of cases, a pullback occur on the resistance
- In 27% of cases, false breakout occur

Forex Notes

- The spacing between each contact point on lines must be important otherwise it could be a pennant.

- More the trend lines are sloped, more the downward movement will be violent.

- False bearish breakouts provide an indication on the side of the exit because in only 3% of cases, when a bearish breakout occurs, the price will exit the wedge by the top. The risk of running a false bearish break out is very low.

- The upward retracement is usually two times faster than the formation of the wedge

- Pullbacks are harmful to the performance of the pattern.

- The breakpoint is generally located around 60% of the length of the rising wedge.

- Rising Wedges which are large give better performance than narrow wedges

Forex Trading Strategies

The classic strategy:

Entry: Take a short position at the breakout of the support
Stop: The stop is placed above the last highest
Target: Theoretical target of the pattern
Advantage: In case of bearish breakout, there is a very small percentage of false signal (even in the case of a false break). Very low risk.
Disadvantage: The target is not often reached (63% of cases), you must determine by yourself your own objectives.

The aggressive strategy:
Entry: Take a short position on a point of contact on the resistance starting from 50% of the length of the wedge
Stop: The stop is placed above the last highest that has been done
Target: Theoretical target of the pattern
Advantage: In 82% of cases, the exit is downward
Disadvantage: The downward breakout is not yet confirmed

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