See how price broke down to the downside? That means there are more forex traders desperate to be short than be long!
They pushed the price down to break the trend line, indicating that a downtrend may be in the cards.
Just like in the other forex trading chart patterns we discussed earlier, the price movement after the breakout is approximately the same magnitude as the height of the formation.
Now let’s take a look at another example of a rising wedge formation. Only this time it acts as a bearish continuation signal.