<p><strong>Descending <a href="/NewSite/encyclopedia/channel/" class="ency-link">Channel</a></strong> is a technical analysis pattern characterized by a pair of parallel, downward-sloping lines that contain the price action, forming a triangular shape. The upper line, or resistance, is drawn using higher highs, while the lower line, or support, is drawn using lower lows.</p>
<p>Descending channels matter as they indicate a <a href="/NewSite/encyclopedia/downtrend/" class="ency-link">downtrend</a> in the market. Traders often use them to identify potential selling opportunities. For instance, a break below the lower line could signal a bearish trend continuation, while a break above the upper line might suggest a potential trend reversal.</p>