A descending triangle has a bearish pattern and features a lower resistance and sequence of lower peaks. It has two converging lines with the first showing high prices and the other marking the lows. The lines converge into a right triangle with a descending hypotenuse.
On its downward trajectory, the price encounters resistance at specific points to partially regain its losses. The result of a retracement being smaller than the previous one is a string of lower highs. The smaller peaks tell you more sellers are joining the market since they’re open to lower prices as a way of initiating a short position.
Consequently, selling pressure mounts as the market prepares to head to the apex. Meanwhile, values on the upper line continue to decrease shrinking the triangle until the bottom line’s support is broken. The crashed support becomes a resistance level confirming the security’s downtrend over time. Ensure both lines are touched a minimum of two times to verify the pattern.