CNERGY | Rising Wedge & Bearish Divergence!Two sign of danger
Rising Wedge Pattern and Bearish Divergence with Volume indicator
Rising Wedge Pattern:
Characteristics: Converging trend lines with higher highs and higher lows, narrowing range.
Interpretation: Bearish reversal pattern, weakening buying pressure.
Trading Strategy: Short selling after break below lower trend line, set stop-loss above upper trend line.
Confirmation: Decreasing volume and other indicators like RSI or MACD can add to bearish implications.
Bearish Divergence with Volume:
When you see a price increase accompanied by decreasing volume in technical charts, it's often considered a bearish sign.
Weakening upward momentum: Decreasing volume during a price increase can indicate that the upward momentum is losing steam. This could be due to a lack of buyers or interest in the stock at current prices.
Potential reversal: A price increase on low volume might suggest that the trend is about to reverse. If there's not enough buying pressure to sustain the price increase, sellers might step in, causing prices to drop.
False breakout: Decreasing volume during a price increase can also indicate a false breakout. If the price breaks out above a resistance level on low volume, it might not be a genuine breakout, and prices could fall back below the resistance level.
