Descending Triangle
Reverse all that we wrote about the Ascending Triangle Pattern and you have the Descending Triangle Pattern. This means, that the Descending Triangle Pattern is formed when the stock is showing strong support at a given low, but it is having lower and lower highs.
The struggle between sellers and buyers is being slowly won by the sellers in this case. So, while the stock is not reaching its lowest low quite yet. This is a bearish sign that it might do so very soon. We would be keeping a close eye on the support level line to be aware of if and when the stock’s share price breaks through support. At this point, it is very likely that the stock will have a heavy fall in share price. You can see an example of a bearish support break in the chart below.
Of course, the opposite could also occur if the stock shows signs of strength by bouncing off of its support line. This is a bullish sign of strong support and that buyers are fighting back. You can see an example of a bullish bounce in the chart below.
