This means that the pattern leads to a fall in the price, so traders need to look for selling opportunities. In technical analysis, the bearish flag price formation is a continuation pattern that signals the pause of a downtrend before the prevailing trend resumes. The opposite of the bull flag is the bear flag. The chart below shows an example of the bullish flag. The buy signal is triggered when the price breaks out of the consolidation in the direction of the prevailing uptrend. This consolidation can be contained within two parallel lines of support and resistance. The flag, which is depicted by an area of tight consolidation that shows a counter-trend move.
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