The Descending Triangle is a chart pattern that reflects increasing selling pressure against a fixed support level. Like other triangle patterns, it can act as either a continuation or a reversal structure depending on the prior market trend.
- Structure: Flat support + lower highs
- Type: Continuation or Reversal (context-dependent)
- Best confirmation: Strong close below support
- Invalidation: Break and hold above descending resistance
What Is a Descending Triangle?
A descending triangle forms when price repeatedly tests a horizontal support level while sellers step in at progressively lower prices. This creates a tightening structure that signals distribution and growing bearish pressure.
The pattern shows that buyers are defending a specific support level, but sellers are becoming more aggressive with each bounce.
Descending Triangle Structure
- Support: A clear horizontal level where buyers repeatedly step in.
- Lower highs: Sellers enter earlier on each rally.
- Compression: Price range tightens as volatility contracts.
Market Context: Why Trend Matters
The descending triangle should never be traded by structure alone. Its outcome depends on the trend preceding the pattern.
Descending Triangle in a Downtrend
When the descending triangle forms during an established downtrend, it most often acts as a bearish continuation pattern. A breakdown below support confirms that sellers remain in control.
Descending Triangle in an Uptrend
When a descending triangle forms after an uptrend, it can signal a bearish reversal. Lower highs indicate increasing selling pressure, and a breakdown below support may mark a shift in market control from buyers to sellers.
How to Trade a Descending Triangle
Entry Option A: Breakdown Confirmation
- Wait for a clean candle close below support.
- Avoid entering on wick-only breakdowns.
Entry Option B: Breakdown and Retest
- After the breakdown, wait for support to flip into resistance.
- Enter after bearish confirmation from the retest.
Stop-Loss Placement (Invalidation)
- Standard stop: Above the most recent lower high.
- Conservative stop: Above the entire triangle structure.
Targets and Next Move
- First target: 1R or nearest support zone.
- Second target: Measured move based on triangle height.
- Trailing option: Structure-based trailing stop in strong trends.
Common Descending Triangle Failures
- False breakdown with no close below support.
- Strong bullish reclaim back above support.
- Breakout attempts during low volume or major news events.
Confirmation Checklist
- Is the higher timeframe trend clearly defined?
- Are lower highs clean and respected?
- Did price close decisively beyond support or resistance?
- Is risk defined before entering the trade?
Related Pages
Disclaimer: Educational content only. No financial advice. Chart patterns are probabilistic tools and require confirmation and proper risk management.
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