Glossary Term

Descending Triangle

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A descending triangle is a bearish chart pattern used in technical analysis to signal an imminent breakdown in the price. It’s plotted over price action by drawing a diagonal, downward sloping trendline that connects the lower-highs set by an asset. This line connects to a horizontal line that marks a support level that the price has failed to break below. If the price breaks below the horizontal trendline it’s a signal for traders to sell which often accelerates the move down. Descending trendlines can also break bullish, this occurs when the price action breaks above the diagonal trendline and manages to stay above it. To confirm a bullish break the price will have to set a higher-high.

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