From Traderpedia

Ledge is a term used by Joe Ross in his Law of Charts.

A ledge consists of a minimum of four price bars. It must have two matching lows and two matching highs. The matching highs must be separated by at least one price bar, and the matching lows must be separated by at least one price bar.

The matches need not be exact, but should not differ by more than three minimum tick fluctuations. If there are more than two matching highs and two matching lows, then it is optional whether to take an entry signal from either the latest price matches in the series (Match ‘A’) or those that represent the highest and lowest prices of the series (Match ‘B’).

A ledge cannot contain more than ten price bars. A ledge must exist within a trend. The market must have trended up to the ledge or down to the ledge. The ledge represents a resting point for prices, therefore you would expect the trend to continue subsequent to a ledge breakout.

[edit] See also

1-2-3 formation
Ross Hook
Trading Range