NIFTY DESCENDING triangle formation
Updated
Here is my overview of descending triangle forming in the price levels.
WHAT IS DESCENDING TRIANGLE??
Formation: A descending triangle pattern begins to take shape after a prolonged downtrend. Traders and analysts notice a series of lower highs forming as the price of an asset consistently makes lower peaks. These lower highs are often seen as a sign of weakening bullish momentum.
Support Level: Simultaneously, a horizontal support level emerges as the price bounces off a particular price point multiple times, creating a horizontal line. This support level represents a significant area of demand, where buyers are willing to step in and prevent the price from falling below that level.
Triangle Shape: The pattern takes the form of a triangle as the descending trendline connecting the lower highs and the horizontal support line intersect. The descending trendline acts as a resistance level that keeps pushing the price down.
Bearish Bias: The descending triangle pattern suggests a strong bearish bias. As the price continues to make lower highs, it indicates that sellers are in control, and buyers are less willing to bid the price up. The horizontal support level becomes increasingly crucial as a decisive point where traders expect the price to either break down or reverse.
Volume Analysis: Volume analysis is essential when considering a descending triangle pattern. Typically, during the formation of this pattern, the trading volume tends to decrease. Lower volume indicates decreased interest in the asset and often precedes a significant price move. Traders often look for an increase in volume when the price breaks below the horizontal support, signaling a stronger confirmation of the bearish trend.
Confirmation and Entry Points: The descending triangle pattern is confirmed when the price breaks below the horizontal support level. This breakdown is a bearish signal, and traders often look for this event to initiate short positions or to exit long positions. Entry points are typically just below the support level, and stop-loss orders are usually set just above the horizontal support or the descending trendline.
Price Target: To estimate the potential price target after a breakdown, measure the height of the triangle from the highest point (the first lower high) to the horizontal support. Then, subtract this measurement from the breakdown point. This gives you an approximate price target for the downward move.
WHAT IS DESCENDING TRIANGLE??
Formation: A descending triangle pattern begins to take shape after a prolonged downtrend. Traders and analysts notice a series of lower highs forming as the price of an asset consistently makes lower peaks. These lower highs are often seen as a sign of weakening bullish momentum.
Support Level: Simultaneously, a horizontal support level emerges as the price bounces off a particular price point multiple times, creating a horizontal line. This support level represents a significant area of demand, where buyers are willing to step in and prevent the price from falling below that level.
Triangle Shape: The pattern takes the form of a triangle as the descending trendline connecting the lower highs and the horizontal support line intersect. The descending trendline acts as a resistance level that keeps pushing the price down.
Bearish Bias: The descending triangle pattern suggests a strong bearish bias. As the price continues to make lower highs, it indicates that sellers are in control, and buyers are less willing to bid the price up. The horizontal support level becomes increasingly crucial as a decisive point where traders expect the price to either break down or reverse.
Volume Analysis: Volume analysis is essential when considering a descending triangle pattern. Typically, during the formation of this pattern, the trading volume tends to decrease. Lower volume indicates decreased interest in the asset and often precedes a significant price move. Traders often look for an increase in volume when the price breaks below the horizontal support, signaling a stronger confirmation of the bearish trend.
Confirmation and Entry Points: The descending triangle pattern is confirmed when the price breaks below the horizontal support level. This breakdown is a bearish signal, and traders often look for this event to initiate short positions or to exit long positions. Entry points are typically just below the support level, and stop-loss orders are usually set just above the horizontal support or the descending trendline.
Price Target: To estimate the potential price target after a breakdown, measure the height of the triangle from the highest point (the first lower high) to the horizontal support. Then, subtract this measurement from the breakdown point. This gives you an approximate price target for the downward move.
Note
we are ranging inbetween the support and resistance in triangle finally a downtrend is comingNote
We Broke down the descending triangle Looking for lower lows till 18000 range
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