Descending Trend Channel

A descending trend channel is a basic chart pattern formed by two parallel trendlines. These two trendlines are going through the high prices and low prices to show a short-term downward trend in the market. The space between the trendlines refers to the descending channel.

Like the ascending trend channel, a descending trend channel is a technical analysis to estimate if the trend will continue. When prices fluctuate between two trendlines, the overall downward trend will remain the same. If prices break out of the channel, it indicates a signal of either buy (break upward) or sell (break downward).