Bull Flag
A sharp upward pole followed by a tight, slightly downward-drifting consolidation channel — a high-probability continuation setup in strong uptrends.
A Bull Flag is a two-part pattern: a near-vertical pole (the initial surge on heavy volume) followed by a flag — a rectangular or gently descending channel that drifts against the trend on lighter volume.
The flag represents brief profit-taking after a strong move. A breakout above the upper channel line, ideally on expanding volume, signals continuation. Target = pole length projected from the breakout point.
- Flags that drift sideways (rather than down) are sometimes called flat tops — equally valid.
- Deep retracements (>50% of the pole) weaken the pattern — the setup should be tight.
Example
A small-cap stock gaps up 15% on earnings and consolidates in a tight 3% range for 5 days with declining volume. On day 6, it breaks above the upper bound on 2× average volume — target is the pole height added to the breakout price.
Related Terms
Bear Flag
A sharp downward pole followed by a tight, slightly upward-drifting channel — a continuation setup that resolves lower once the flag breaks.
BeginnerBreakout Retest
Price returning to test the former breakout level after the initial break — a resistance-turned-support confirmation and lower-risk entry point.
BeginnerContinuation Pattern
Any pattern that forms mid-trend and resolves in the same direction as the prior move — flags, pennants, and triangles are the most common.
BeginnerCup and Handle
A rounded bowl-shaped base followed by a small downward drift (the handle) — a bullish continuation pattern preceding a breakout to new highs.
IntermediateFlag
A brief rectangular consolidation against the prior trend, bounded by parallel trendlines — a high-frequency continuation setup.
BeginnerMeasured Move
A technique projecting a price target by duplicating a prior swing move from a breakout or consolidation point.
BeginnerPennant
A pole followed by a small symmetrical triangle — a tight continuation coil that resolves in the direction of the prior thrust.
BeginnerThrowback
A post-breakout pullback to the broken resistance level, which now acts as new support — a common re-entry opportunity in trending markets.
Beginner