Does a tighter falling wedge make a better trade?
Version 1.0 · report 2026-09-10 · study recorded 2026-09-10

QUESTION AND FINDING
A tighter shape can look like a stronger signal. But removing the confirmed loose wedges made this simulated account grow more slowly, with little change in its largest decline. Being pickier about the drawing did not improve the whole strategy in this test.

METHOD
Snapshot: Ledger 905 / manifest 1323, generated September 10, 2026 at 09:36:33 UTC. Typed portfolio method portfolio_v1_typed_exact_v6_entry_policy_er2p5_floor_one_open. Falling-wedge trade dates October 13, 2006 through September 9, 2026; 770 family symbols within a 2,569-symbol source universe.
Shape rule: Ending boundary width divided by starting boundary width greater than 0.50 is loose. Original geometry verified for 1,080 of 1,149 rows. Of 69 unknowns, 66 lacked a matched original snapshot digest and three had ambiguous execution matches.
Account comparison: All 1,149 opportunities versus 885 after excluding 264 confirmed loose rows. Unknowns remain in both. Existing sizing and capacity rules were retained; 25 paired allocation-jitter seeds were tested.
Robustness: All 25 paired growth differences were negative. Median annualized-growth change: −3.5378187 percentage points; range −4.9520 to −2.5614. The displayed representative run has a −3.8185-point change; it is not the seed median.
Trade-level uncertainty: Loose-minus-tighter mean payoff difference +0.0968R; reported interval −0.1300 to +0.3352R. This does not establish a reliable payoff edge for loose shapes. No additional transaction-cost stress test was run.
Evidence: Frozen machine-readable result and analysis scripts retained. Source SHA-256: 5cc9e63a7ed9e9a7c7c2fc7cb0e930f066164dd97503aa8676c6b2b57f052c68. This edition uses the current refresh, not the superseded 9,991-row shape study.

SOURCE
Source: TradingPal’s September 10, 2026 current-cohort falling-wedge refresh, frozen ledger 905 / manifest 1323. This replaces the older shape comparison used in earlier episode drafts.

LIMITATIONS
- These are historical simulations, not actual customer trades or papers reviewed by independent academic experts. Prices, trading costs and future market conditions can produce different results.
- Several trades can come from the same stock or the same market period. They are not independent coin flips. A large trade count does not turn one historical comparison into a promise about the future.
- The historical universe does not fully represent companies that failed or disappeared. Daily price summaries also cannot show every move within a trading session, and modeled entries or exits may be unavailable in practice.
- The cutoff was applied retrospectively; this is not an independent future-period validation. Changes to entries, exits, fees or available capital may change the filter’s effect.
- Available-trade counts are not executed account-trade counts. The reported maximum drawdown uses the study’s realized-equity convention and may understate losses visible while positions remain open.

CITATION
TradingPal Research (2026-09-10). Does a tighter falling wedge make a better trade? Version 1.0. Historical study recorded 2026-09-10. https://tradingpal.io/learn/research/falling-wedge-tightness-study