Patterns › Reversal
Falling Wedge pattern
A falling wedge is a bullish pattern in which price declines between two downward-sloping, converging trendlines; the narrowing range signals fading selling pressure, and the pattern typically resolves with a breakout above the upper trendline.
Stocks forming it recently ↓
What does a falling wedge look like?
Our scanner checks it as a setup where all of these hold:
- A pattern 16 to 60 trading days long.
- At least two swing highs along a falling upper line, and at least two swing lows along a lower line.
- The lower line falls too, or rises only slightly (up to 0.1% a day).
- The upper line is at least 10% steeper than the lower one, and the lines narrow the range by at least 30% (40% for wedges shorter than 25 days).
- The lines haven't nearly met: today is no more than 95% of the way to where they would cross.
- Price inside the wedge, or no more than 20% of the wedge's height above the upper line.
- Not down more than 2% on the day (1% if it also closed below its open), and RSI at least 25.
- A prior downtrend and volume aren't checked.
How reliable is the falling wedge pattern?
In our most recent backtest (March – September 2026, out-of-sample), 78.3% of the 1,541 highest-scoring falling wedge setups, out of 46,891 studied, were trading higher two weeks later.
How are entry, stop and target set?
Every pick comes with an entry zone, price targets and a stop. The targets come from how far past falling wedge setups actually moved, not from a textbook projection of the pattern's height. The stop scales with the stock's own average daily range, so a volatile stock gets a wider stop than a quiet one.
How is it different from a symmetrical triangle?
Both squeeze price between converging trendlines, but in a falling wedge both lines slope downward and the expected break is upward, while a symmetrical triangle has one falling and one rising line and can break in either direction.
Stocks forming a falling wedge recently
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