🔻 DESCENDING TRIANGLE CHART PATTERN – BEARISH SETUP YOU SHOULDN’T IGNORE 📉

🔍 What Is It?

A Descending Triangle forms when:

🔹 Lower highs show rising selling pressure

🔹 Flat support shows buyers holding ground — for now

🔹 Price compresses in a triangle shape

🔹 A bearish breakout is likely

📈 Key Characteristics

✅ Horizontal support – Price keeps testing the same level

✅ Descending resistance – Lower highs show weakening demand

✅ Volume drops during formation

✅ Volume spike confirms the breakout

✅ Can signal continuation or reversal depending on trend context

🧠 How to Identify It:

📌 Flat support + descending highs

📌 Price getting squeezed

📌 Watch volume – it should drop as triangle tightens

📌 Breakout = below support line with volume surge

💣 How to Trade the Descending Triangle:

🔸 Breakout Strategy

• Enter short on breakout below support

• Set target = height of triangle projected down

• Stop-loss above last high or breakout candle

🔸 With Moving Averages

• Confirm with 20/50 MA

• Death cross = strong short signal

• Trade on breakdown + MA cross for extra confirmation

🔸 Reversal (Top)

• Pattern forms at the top of an uptrend

• Short at breakdown

• Project triangle height for target

🔸 Reversal (Bottom)

• Rare but bullish twist

• Watch for breakout above descending resistance

• Long entry if confirmed + strong volume

🎯 Advantages

✔️ Clear bearish bias

✔️ Works across timeframes

✔️ Accurate breakout levels

✔️ Objective targets & stop-loss zones

✔️ Great risk-reward setups

⚠️ Limitations

❗️ False breakouts = common — always wait for confirmation

❗️ Subjective trendline drawing

❗️ News events can invalidate the setup

❗️ Price can move sideways for too long

❗️ Occasionally breaks up instead of down

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$BTC