A flag pattern is a trend continuation pattern, appropriately named after it’s visual similarity to a flag on a flagpole. A “flag” is composed of an explosive strong price move that forms the flagpole, followed by an orderly and diagonally symmetrical pullback, which forms the flag. When the trendline resistance on the flag breaks, it triggers the next leg of the trend move and the coin proceeds ahead. What separates the flag from a typical breakout or breakdown is the pole formation representing almost a vertical and parabolic initial price move. Flag patterns can be bullish or bearish.
Bullish Flag
Bullish flag formations are found in coins with strong uptrends. They are called bull flags because the pattern resembles a flag on a pole. The pole is the result of a vertical rise in a coin and the flag results from a period of consolidation. The flag can be a horizontal rectangle, but is also often angled down away from the prevailing trend.
Bearish Flag
The pattern itself is divided into three parts. First we need to find the flag pole which will be identified as our initial decline. This decline can be steep or slowly sloping and will establish the basis for our trend. Next we have the flag itself. This is identified as a period of consolidation after the completion of prices initial decline. During this period, prices may slowly channel upward and retrace a portion of the initial move. At this point traders will wait for price to break to lower lows in the direction of the trend.
After price begins to move lower again, we can then find the final component needed for trading a bearish flag pattern. The profit target is a potential value to take profit after a currency pair’s next decline in price. This pricing level can be identified by first measuring the distance in rise of our initial decline. This value can then be subtracted from the peak resistance line formed from our consolidating flag.
______________________________________
If You don’t have time to research what coins are right to buy, then join our inside community
where our market experts give out crypto signals that are technically and fundamentally promising!
______________________________________
►Homepage — www.ktitrading.com
►FREE Telegram — https://t.me/ktitrading
►Telegram Support — https://t.me/kticustomerservice
►Facebook Support — https://m.me/ktitrading
✅ JOIN NOW — https://t.me/ktitradingbot
______________________________________
