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Hey traders! This week, I want to dive into one of the most reliable bearish continuation patterns – the downtrend triangle. The USDCAD chart provides us with a textbook example of how these patterns unfold and create exceptional shorting opportunities. Understanding Downtrend Triangles Downtrend triangles form when price creates a series of lower highs while finding support at a horizontal level. This creates a wedge pattern that typically resolves to the downside, making it a powerful bear

Hey traders! This week, I want to dive into one of the most reliable bearish continuation patterns – the downtrend triangle. The USDCAD chart provides us with a textbook example of how these patterns unfold and create exceptional shorting opportunities. Understanding Downtrend Triangles Downtrend triangles form when price creates a series of lower highs while finding support at a horizontal level. This creates a wedge pattern that typically resolves to the downside, making it a powerful bearish continuation signal. What makes these patterns so effective is the psychological pressure they create – each failed rally attempt weakens buyer confidence while strengthening seller conviction. USDCAD's Perfect Triangle Formation Looking at the USDCAD chart, we can see a beautiful downtrend triangle that developed after the initial breakdown from the 1.3850 area. The pattern shows classic characteristics with a clear descending trendline connecting the lower highs and horizontal support around 1.3580. Notice how price repeatedly tested the descending resistance line (marked in yellow), with each bounce getting weaker. This compression pattern built significant bearish pressure, setting the stage for the eventual breakdown. The orange vertical line marks a key moment in the pattern's development, likely representing a significant news event or market shift that accelerated the bearish momentum. The Inevitable Breakdown When the horizontal support at 1.3580 finally gave way, the move was decisive and powerful. Price didn't just break down – it collapsed, falling from 1.3580 to below 1.3350 in a matter of days. This is exactly what we want to see in a triangle breakdown: conviction, volume, and follow-through. The target for this pattern (measuring the triangle's height and projecting it downward) has been exceeded, showing the pattern's effectiveness. My Downtrend Triangle Strategy When I trade these USDCAD setups, I follow these principles: Identify the descending trendline with at least three touches Confirm horizontal support is holding (multiple tests) Watch for decreasing volume during the triangle formation Enter short when price breaks below horizontal support Place stops above the last swing high within the triangle Target at least the triangle's height projected from the breakdown point The key is patience during the formation and decisive action on the breakdown. Current USDCAD Outlook With the successful triangle breakdown now complete, USDCAD appears to be in a strong bearish trend. The breakdown level around 1.3580 should now act as significant resistance on any retest attempts. Given the magnitude of this move, we could see a retracement back toward 1.3450-1.3500 before the next leg lower. However, any rally above 1.3580 would suggest the breakdown might be failing. The long-term target based on this triangle pattern suggests potential downside toward 1.3200-1.3250, representing the full measured move. Key Takeaways Downtrend triangles are some of the most reliable patterns in technical analysis because they combine multiple bearish signals: lower highs, failed rallies, and eventual support breakdown. The USDCAD example shows how patience during the formation phase can lead to explosive profits when the pattern finally resolves. The Morning Power Hour Indicator is your edge in the first hour of trading—when momentum is real, volume is heavy, and the noise hasn’t kicked in. ✅ Buy signal? Trade ATM calls, 7–10 day expiry. ✅ Sell signal? Trade ATM puts, same timeframe. 🎯 Exit when the price hits the target line. Simple. Precise. Repeatable. The 50% off deal is still live—if you’re ready to trade smarter and earlier, this is your moment. CLICK HERE TO GAIN ACCESS Until next time, watch for those descending triangles – they're often the precursors to some of the market's biggest moves! Trade smart,  TradingStrategyGuides IMPORTANT NOTICE! No representation is being made that the use of this strategy or any system or trading methodology will generate profits. Past performance is not necessarily indicative of future results. There is substantial risk of loss associated with trading securities and options on equities. Only risk capital should be used to trade. Trading securities is not suitable for everyone. Disclaimer: Futures, Options, and Currency trading all have large potential rewards, but they also have large potential risk. You must be aware of the risks and be willing to accept them in order to invest in these markets. Don't trade with money you can't afford to lose. 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