Wedge shape:

(I) Application principles of wedge shape

Generally speaking, the application of wedge shape should follow the following principles:

1. Since wedge shape is a short-term to medium-term trend shape, it is suitable for short-term trading.

2. The upper and lower lines of the wedge shape must be obviously convergent. If the shape is too loose, the shape is less likely to form and is likely to evolve into other consolidation shapes.

3. The directions of the upper and lower lines in the overall wedge shape must be the same and obviously converge to one point.

4. If an ascending wedge shape occurs in a downward trend, it can be inferred that it is a rebound wave, not the first wave of the bulls, but attention should be paid to the bearish trend in the future market.

(II) Disadvantages and remedial measures of wedge shape

1. Sometimes the wedge shape is similar to the triangle shape, but the trend meanings of the two are completely different and need to be distinguished clearly.

2. Recognize its characteristics. The price fluctuations of the wedge shape are relatively close, and the inclination rate of the two trend lines is obviously upward or downward. Therefore, if one side of the trend line is found to be close to horizontal, such an arrangement should be a right triangle shape.