|Broadening Formations Right Angled and Descending wedge
Broadening Formations Right Angled and Descending Resembles a megaphone tilted down, with the top of the formation horizontal and bounded on the bottom by a down-sloping trendline. A horizontal line of resistance joins the tops as a trendline. Must have at least two distinct touches before driving a trendline. The expanding price series is bounded on the bottom by a down sloping trendline. Must have at least two distinct minor lows to create a trendline.
Percent of successful formations for upside breakout – 89%
Percent of successful formations for downside breakout – 69%
Failure rate – 19%
Average time to throwback/pullback completion – 2 hours
Compute the formation height by taking the difference between the horizontal top and the lowest low in the formation. For upside breakouts, add the result to the value of horizontal trendline. For downside breakout, subtract the value from the lowest low. The result is the expected target price.