TA Education｜How to Spot 2 Common Bearish Patterns?

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12-05
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Hello everyone! Today, we’ll be learning the second lesson of the TA Challenge, focusing on identifying two types of bear market patterns and providing relevant stock examples. You can click here to access yesterday’s lesson: 🎁TA Education｜Understand Market Signals! How to Spot $MSFT & $TSLA's Uptrend? and future lessons will continue to be published on the Tiger Chat account!

Healthy Downtrend

Key Characteristics of a Healthy Downtrend:

  • Price forms lower lows and lower highs: Each bounce is weaker than the last, confirming sellers are in control.

  • Volume expands on downswings: Red volume bars increase as selling pressure intensifies.

  • Volume contracts on relief rallies: Temporary upward moves happen on weak volume, showing buyers lack strength.

  • Essentially the opposite of a healthy uptrend: Momentum flows downward, supported by stronger selling participation.

Example: $Meta Platforms, Inc.(META)$, August to September 2023 During this period, META exhibited a textbook downtrend. Prices continued to create lower highs and lower lows, while volume consistently surged during sell-offs and faded during small rebounds. This pattern confirmed strong bearish momentum and a sustained seller-driven trend.

False Breakout (Low Volume)

Key Characteristics of a False Breakout:

  • Price breaks above resistance but volume is weak: The move looks real at first, but lacks the participation needed to sustain it.

  • Often just “pokes” above the level, then quickly reverses: Price cannot stay above resistance and slips back inside the range.

  • Signals a lack of conviction: Buyers are not strong enough to support the breakout.

  • Analogy: Like trying to push open a heavy door, but no one is helping from behind.

For example: $CME Bitcoin - main 2512(BTCmain)$ , March 3–23 During this period, Bitcoin briefly pushed above resistance, but volume stayed weak. The breakout failed to gain traction, and the price quickly fell back below the level—classic signs of a false breakout caused by insufficient buying pressure.

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This series aims to break down commonly used technical indicators simply and intuitively, helping investors improve their ability to interpret market trends, momentum, and risk. Whether you're a beginner or an experienced trader, you’ll quickly grasp the core logic behind each indicator, avoid common misuses, and strengthen your practical analysis skills. Share your technical analysis insights to win $5 stock vouchers and tiger coins!
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Comments

  • MHh
    12-07
    MHh
    @HelenJanet @Fenger1188 @Success88 @Universe宇宙 @SR050321 @Kaixiang @DiAngel @SPOT_ON @Wayneqq @LuckyPiggie come Come learn about TA for bearish patterns. Important for traders especially though long term investors can also use it to consider waiting for further dips before adding positions. Being able to use both TA and fundamentals would be powerful for both traders and investors alike.
  • ECLC
    12-06
    ECLC
    Chart showed the reversal into healthy downtrend with price forms lower lows and lower highs; higher red bars volume on intensified selling and lower volume on relief rallies.
  • Alubin
    12-07
    Alubin
    Based on the chart, the stock has entered a bearish phase, characterized by a pattern of forming progressively lower highs and lower lows. This shift is supported by higher trading volume during sell-offs and weaker volume on price increases, indicating strengthening selling pressure and a lack of conviction from buyers.
  • 1PC
    12-11
    1PC
    Reference to $UOB-U11: From late July to mid‑Sep 2025, price formed lower highs & lower lows 📉 — Classic signs of a healthy downtrend. Volume expanded on sell‑offs, contracted on rebounds 🔻. EP3 zone (12SEP25) showed weak recovery momentum, reinforcing bearish structure. Textbook trend exhaustion[LOL].@JC888 @Barcode @koolgal @Shyon @Shernice軒嬣 2000 @Aqa @DiAngel
  • Tiger_comments
    12-10
    Tiger_comments
    Thanks for participating in my discussion. Your coins have been sent through the tiger coin center!
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  • icycrystal
    12-06
    icycrystal
    good summary [Like] [Like] [Like]

    Key Characteristics of a Healthy Downtrend:

    Price forms lower lows and lower highs: Each bounce is weaker than the last, confirming sellers are in control.


    Volume expands on downswings: Red volume bars increase as selling pressure intensifies.


    Volume contracts on relief rallies: Temporary upward moves happen on weak volume, showing buyers lack strength.


    Essentially the opposite of a healthy uptrend: Momentum flows downward, supported by stronger selling participation.

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