Case Study #1 — Ford (Bearish Channel Structure)
This chart shows a classic bearish channel structure.
A bearish trend is defined by two key elements:
-Lower highs (LH)
-Lower lows (LL).
As long as price continues to respect this pattern, the trend remains intact.
How to approach this structure:
First, identify the channel boundaries.
The upper line acts as resistance (selling pressure), while the lower line acts as support (potential reaction zone).
Avoid trading in the middle.
Most losses happen when traders enter without a clear location.
Focus on the extremes:
Near resistance → look for rejection or weakness
Near support → watch for reactions or failed breakdowns
Important concept:
Not every breakout leads to a new trend.
A breakout that fails and returns inside the structure is known as a bull trap.
A breakdown that fails can lead to a strong bounce.
Key takeaway:
The trend provides context
The extremes provide opportunity
The reaction provides confirmation
This behavior repeats across markets and timeframes.
Study the structure, not just the outcome.
—
Not financial advice.
This chart shows a classic bearish channel structure.
A bearish trend is defined by two key elements:
-Lower highs (LH)
-Lower lows (LL).
As long as price continues to respect this pattern, the trend remains intact.
How to approach this structure:
First, identify the channel boundaries.
The upper line acts as resistance (selling pressure), while the lower line acts as support (potential reaction zone).
Avoid trading in the middle.
Most losses happen when traders enter without a clear location.
Focus on the extremes:
Near resistance → look for rejection or weakness
Near support → watch for reactions or failed breakdowns
Important concept:
Not every breakout leads to a new trend.
A breakout that fails and returns inside the structure is known as a bull trap.
A breakdown that fails can lead to a strong bounce.
Key takeaway:
The trend provides context
The extremes provide opportunity
The reaction provides confirmation
This behavior repeats across markets and timeframes.
Study the structure, not just the outcome.
—
Not financial advice.
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Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.
Related publications
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.