A descending triangle is a trend continuation pattern, most often signaling a bearish breakout.
How It Looks
Lower boundary: horizontal support level.
Upper boundary: descending trendline (price forms lower highs).
Meaning:
Sellers are steadily increasing pressure → support weakens → a breakout to the downside becomes likely.
How to Trade the Descending Triangle
Method 1: Aggressive
Entry: after the price breaks below the support level (ideally wait for a candle to close below it).
Stop-loss: above the descending trendline.
Take-profit: measure the height of the triangle’s base and project it downward from the breakout point.
Method 2: Conservative
Wait for a breakout and retest of the broken support (now acting as resistance).
Entry: after the retest confirms the new resistance.
Stop-loss: above the new resistance level.
Take-profit: same as Method 1 (height of the triangle).
Tips for Higher Accuracy
Works best in a downtrend.
Volume: typically decreases during pattern formation and spikes during the breakout.
The longer the triangle forms, the stronger the potential move after the breakout.
Conclusion:
The descending triangle is a strong bearish continuation pattern. Using breakout confirmation and volume analysis improves the reliability of trades based on this setup.