Descending triangles can form as a reversal pattern to an uptrend, but they are generally seen as bearish continuation patterns.
Most traders look to initiate a short position following a high volume breakdown from lower trend line support in a descending triangle chart pattern. In general, the price target for the chart pattern is equal to the entry price minus the vertical height between the two trend lines at the time of the breakdown. The bottom trend line support also serves as a stop-loss level for traders to limit their potential losses.
The limitation of triangles is the potential for a false breakdown. There are even situations where the trend lines will need to be redrawn as the price action breaks out in the opposite direction - no chart pattern is perfect. If a breakdown doesn't occur, it could rebound to re-test the upper trend line resistance before making another move lower to re-test lower trend line support levels. The more times that the price touches the support and resistance levels, the more reliable the chart pattern.
There are two possible scenarios in the next couple of hours: BTC retests resistance line and breaks it, and then retests again the next resistance line; BTC breaks support and falls until next support. Putting SL right under 50 MA.
Most traders look to initiate a short position following a high volume breakdown from lower trend line support in a descending triangle chart pattern. In general, the price target for the chart pattern is equal to the entry price minus the vertical height between the two trend lines at the time of the breakdown. The bottom trend line support also serves as a stop-loss level for traders to limit their potential losses.
The limitation of triangles is the potential for a false breakdown. There are even situations where the trend lines will need to be redrawn as the price action breaks out in the opposite direction - no chart pattern is perfect. If a breakdown doesn't occur, it could rebound to re-test the upper trend line resistance before making another move lower to re-test lower trend line support levels. The more times that the price touches the support and resistance levels, the more reliable the chart pattern.
There are two possible scenarios in the next couple of hours: BTC retests resistance line and breaks it, and then retests again the next resistance line; BTC breaks support and falls until next support. Putting SL right under 50 MA.