trading question: what is a "wedge" and "broken wedge"?

R

Roger Hershey

There are these 2 terms that I've read on ET, but I don't understand.

Can someone explain what a "wedge" is, and what a "broken wedge" is?

I want to be ready for the next broken wedge, so I'm looking to educate myself.
 
Quote from Roger Hershey:

There are these 2 terms that I've read on ET, but I don't understand.

Can someone explain what a "wedge" is, and what a "broken wedge" is?

I want to be ready for the next broken wedge, so I'm looking to educate myself.
More...

Here are some example describing different wedges and how they are broken.

http://www.trade-ideas.com/Help.html#GTBOT

http://www.trade-ideas.com/Help.html#GTTOP

http://www.trade-ideas.com/Help.html#GBBOT

http://www.trade-ideas.com/Help.html#GBTOP
 
I did a search on this site, and the last time a "wedge" was mentioned was on babak's journal. He said that the "wedge was broken" when the S&P hit 915.

Does this mean that interpreting wedges is subjective? He seemed to have so thoroughly mistaken the chart pattern, that it appears that a wedge may be subject to broad interpretation.

Or maybe we should let babak talk for himself...
 
Quote from Roger Hershey:

I did a search on this site, and the last time a "wedge" was mentioned was on babak's journal. He said that the "wedge was broken" when the S&P hit 915.

Does this mean that interpreting wedges is subjective? He seemed to have so thoroughly mistaken the chart pattern, that it appears that a wedge may be subject to broad interpretation.

Or maybe we should let babak talk for himself...
More...

So how many "Roger Hershey" posts do we get before we figure it out? When we figure it out, what do we do about it?
 
In my journal I refer to TAST by Edwards and Magee. I would refer you to that source as the best reference for technical formations.

http://www.elitetrader.com/vb/showthread.php?s=&threadid=16711&perpage=6&pagenumber=12

The markets (at that time) were in a wedge formation and then broke down on May 19 '03. I mentioned both of these facts in my journal. However, later they reversed and continued their ascent. And actually broke to the upside of the wedge formation on June 2 '03. The dates refer to the Dow btw.

Here's the thing about wedges, or any other formation. They are guides. They simply serve to skew the probabilities in your favour. They are not sure things.

At least not like you (in your TradeRX incarnation) calling the tops and bottoms of NVDA intraday a while back.
 
A wedge is when a friend grabs your underwear and pulls it upward in a very violent manner. I have no idea what a broken wedge is. :D :D :D
 
I'm not, and never was traderRx, or whatever. This can be easily proven by checking my email addresses against his.

Furthermore, as I told you in the PM, I don't trade NVDA. You should know better than to say that. You followed a certain website rather closely a few years ago, and in that website, there was no 4 letter trading.

You see, the COMPX rose 85% in 1999, and that would have buried anyone and everyone who thought the COMPX was overpriced at 2000.

And what are you having now, some sort of hissie fit?

This is about wedges, stay on topic!
 
Bearish wedge is a rising narrow triangle , that breaks and then falls. Typical target is the 80-100% of the range of the wedge.

Bullish wedge is a downward triangle shape.

I guess "broken" is relative to what you're talking about.. you could say the wedge is "broken" - as in broken it's trendline and that is your trigger for the reversal.

Or you could say a "failed' wedge, where a downsloping wedge doesn't reverse bullishly, but instead breaks the lower trendline to go down at a greater rate of acceleration.
 

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