TA Education｜How to Spot 2 Common Bearish Patterns?

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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Event Duration

Now till 31st Dec.