7. Chart Patterns: Bearish Chart Patterns

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Last updated 5:46 AM on 7/22/26
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6 Terms

1
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Bear Flag

Pattern Type: Bearish, trend continuation

Requirements:

a. Preceding bearish trend

b. Upward consolidation channel

c. Breakout below consolidation channel

Meaning: A brief consolidation following a downward price movement, indicating an anticipated resumption of the downtrend as sellers dominate. Entry: Breakout below bottom of channel Exit: Next key level

<p>Pattern Type: Bearish, trend continuation </p><p>Requirements:</p><p> a. Preceding bearish trend</p><p> b. Upward consolidation channel </p><p>c. Breakout below consolidation channel </p><p>Meaning: A brief consolidation following a downward price movement, indicating an anticipated resumption of the downtrend as sellers dominate. Entry: Breakout below bottom of channel Exit: Next key level</p>
2
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Descending Triangle

Pattern Type: Bearish, trend continuation

Requirements:

a. Preceding bearish trend

b. Horizontal level

c. Downward-sloping trendline

d. Breakout below horizontal level

Meaning: Sellers are becoming more aggressive, pushing the price lower despite support. Entry: Breakout below horizontal level Exit: Next key level

<p>Pattern Type: Bearish, trend continuation</p><p> Requirements: </p><p>a. Preceding bearish trend </p><p>b. Horizontal level </p><p>c. Downward-sloping trendline</p><p> d. Breakout below horizontal level </p><p>Meaning: Sellers are becoming more aggressive, pushing the price lower despite support. Entry: Breakout below horizontal level Exit: Next key level</p>
3
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Bearish Pennant

Pattern Type: Bearish, trend continuation

Requirements:

a. Preceding bearish trend

b. Top downward-sloping trendline

c. Bottom upward-sloping trendline

d. Breakout below lower trendline

Meaning: A brief consolidation after a strong downtrend price movement, signaling a likely continuation of the downtrend as sellers regain control. Entry: Breakout below lower trendline Exit: Next key level

<p>Pattern Type: Bearish, trend continuation </p><p>Requirements: </p><p>a. Preceding bearish trend</p><p> b. Top downward-sloping trendline </p><p>c. Bottom upward-sloping trendline</p><p> d. Breakout below lower trendline</p><p> Meaning: A brief consolidation after a strong downtrend price movement, signaling a likely continuation of the downtrend as sellers regain control. Entry: Breakout below lower trendline Exit: Next key level</p>
4
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Rising Wedge

Pattern Type: Bearish, trend reversal

Requirements:

a. Preceding bullish trend

b. Top upward-sloping trendline

c. Bottom upward-sloping trendline

d. Breakout below bottom trendline

Meaning: It indicates that a rising price trend is showing signs of weakening, and sellers are stepping in to potentially halt the uptrend. Entry: Breakout below bottom trendline Exit: Next key level

<p>Pattern Type: Bearish, trend reversal</p><p> Requirements:</p><p> a. Preceding bullish trend</p><p> b. Top upward-sloping trendline </p><p>c. Bottom upward-sloping trendline</p><p> d. Breakout below bottom trendline</p><p> Meaning: It indicates that a rising price trend is showing signs of weakening, and sellers are stepping in to potentially halt the uptrend. Entry: Breakout below bottom trendline Exit: Next key level</p>
5
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Head & Shoulders

Pattern Type: Bearish, trend reversal

Requirements:

a. Preceding bullish trend

b. Two shorter peaks of equal height

c. Middle higher peak

d. Neckline

e. Breakout below neckline

Meaning: Bulls fail to push price higher and as price declines to create a neckline, bears take control for a trend reversal. Entry: Breakout below neckline Exit: Next key level

<p>Pattern Type: Bearish, trend reversal </p><p>Requirements:</p><p> a. Preceding bullish trend </p><p>b. Two shorter peaks of equal height</p><p> c. Middle higher peak </p><p>d. Neckline </p><p>e. Breakout below neckline</p><p> Meaning: Bulls fail to push price higher and as price declines to create a neckline, bears take control for a trend reversal. Entry: Breakout below neckline Exit: Next key level</p>
6
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Double/Triple Top

Pattern Type: Bearish, trend reversal

Requirements:

a. Preceding bullish trend

b. Two or three equal tops

c. Breakout below neckline

Meaning: The "top" refers to peaks in price where it reaches a level that appears resistant to further incline. This indicates that buying pressure is finishing, hinting a reversal. Entry: Breakout below neckline Exit: Next key level

<p>Pattern Type: Bearish, trend reversal </p><p>Requirements:</p><p> a. Preceding bullish trend </p><p>b. Two or three equal tops </p><p>c. Breakout below neckline </p><p>Meaning: The "top" refers to peaks in price where it reaches a level that appears resistant to further incline. This indicates that buying pressure is finishing, hinting a reversal. Entry: Breakout below neckline Exit: Next key level</p>