📉 How to Identify a Downtrend – Simple Trader's Guide

Want to know when the market is turning bearish? Here are 9 clear signs to spot a downtrend:

1️⃣ Lower Highs & Lower Lows

When price keeps forming lower highs and lower lows — that’s a classic downtrend signal.

2️⃣ Fibonacci Rejections

If price retraces and then reverses near key Fibonacci levels, more downside may follow.

3️⃣ Broken Support Zones

Losing key support levels often leads to sharp declines and further bearish momentum.

4️⃣ Downward Channels

When price moves within a falling channel, it's trending lower within a controlled range.

5️⃣ Bearish Flag Patterns

Small upward consolidations after a sharp drop often signal continuation — expect another leg down.

6️⃣ High Volume on Sell-offs

Rising volume during price drops = strong seller pressure and confirms the trend.

7️⃣ Price Below Moving Averages

If price stays below key MAs (like 50 or 200 EMA), the downtrend is intact.

8️⃣ MA Bearish Crossovers

When a shorter MA crosses below a longer one (e.g. 20 EMA below 50 EMA), it signals extended weakness.

9️⃣ Elliott Wave Patterns

In a bearish wave structure, look for 5 impulsive downward moves showing trend continuation.

✅ Conclusion:

Watch these signals to identify market downtrends early — helping you avoid losses, exit in time, or even profit by shorting.

💬 Which of these do you use in your trading? Drop your thoughts below!

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