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A Wedge is a technical chart pattern that is composited of two converging lines that connect peaks and troughs.
Wedges and triangles are both formed by two trendlines, the difference between these two chart patterns is that a triangle, whether it is an ascending or descending triangle, contains an horizontal line, while wedges does not.
The wedges are of two types, rising and falling wedges.
In a rising wedge, the first trendline connects higher highs and therefore is heading up, whereas the second trendline connects higher lows and it is also heading up.
In the case of a falling wedge, the first trendline connects lower highs, whereas the second line connects higher lows; both lines are heading down.
Wedges could be considered as short-lived breaks in price trends. Technical traders are bullish when the asset price breaks above the first line of a falling wedge and are bearish when the asset price beaks below the second line of a rising wedge.
Wedges signals are downloaded from the Finviz website and are stored in a custom database. The data can be accessed using the "GetData" function.
Example:
buy = GetData("pattern_wedges", "wedge_up", Zero);
The above formula can be used in a trading system to buy stocks with a rising wedge pattern.
