Descending trend lines are own of the most effective trend lines used for carrying out a technical analysis. Descending trend lines can be categorized as simple trend lines having a negative slope which indicates a falling prices. There are two kinds of descending trend lines such as descending top trend lines and descending bottom trend lines. The descending top trend lines are trend lines in which high prices for an asset are falling. Descending bottom trend lines, consist of falling low prices for an asset .The trading rules for descending trend lines are the similar to the general trend lines trading rules applied by investors. A descending top trend line can be categorized as a resistance point against the falling price for an asset. However, descending bottom trend line is a measure of the support for the asset’s price. Therefore, traders mostly think that this is an signals for selling an asset. However, some traders also consider additional signals while going for selling decision.
Menu