Industry experts, David Hightower and Joe Vaclavik, discuss the upcoming USDA Prospective Plantings Report to be published on 31 March 2017.
In this week’s article, we examine the broadening wedge formation. The trade example below is called an ascending broadening wedge because it is similar to a rising wedge formation and has a broadening price pattern. The upper resistance trend line of an ascending broadening wedge slopes upward at a greater rate than the lower supporting trend line, creating an obvious broadening appearance. With ascending broadening wedge formations volume tends to increase slightly as the breakout approaches. These patterns are highly reliable once a downside break occurs, but are less reliable prior to the break of the lower trend line. Let’s have a look at how we can take advantage of this pattern below:
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The golden cross occurs when the shorter term moving average rises and crosses above the longer term moving average. One of the most common golden crosses used is the 20-period and 50-period moving average crossover. A golden cross is often associated with sharp upward price movement and can be used as a buy signal in the belief that a significant uptrend will follow. The position is maintained until the shorter term moving average crosses below the longer term moving average.