Learning Corner : Descending Triangle
This is Pharma ... I do still remember I bought before on breakout. This is weekly chart ... showing what we called 'descending triangle'.
By theory, Pharma should not do below RM5.50 level or we should see the breakdown.
Note : The descending triangle is a bearish formation that usually forms during a downtrend as a continuation pattern. There are instances when descending triangles form as reversal patterns at the end of an uptrend, but they are typically continuation patterns. Regardless of where they form, descending triangles are bearish patterns that indicate distribution.
www.stockcharts.com ... this is a good site I have given to my newbies who came for my workshop yesterday. We do not need to learn all these in workshop as we could just give them the resources for them to READ and guide them in 'live' chart ... and show them what is working, how it works ... and what is not working and why it failed.
Technical analysis might be quantitative and the descending chart above may NOT necessary be bearish!! But in technical charting, we are talking about PROBABILITY.
We should not be buying into a 'descending triangle'. It is bearish and downtrending.
Once the RM5.50 broken .... the downtrend should accelerate and if we could SHORT-SELL, do it.
Disclaimer : This is for educational purposes. Do not take this as a buy-sell call.