#TermoftheDay
- Flag & Pole Pattern
Mukesh Gupta: As name suggests, it’s a candlestick formation resembles an either
a upwards flag (bullish one) or a downwards flag (bearish one). In a bullish
formation price moves upwards with a consistent pace and forms a pole, than
consolidate in a bearish trend (in a range) by making a lower highs and lower
lows (*imp-these lower lows are always high than the low of pole*) thus forming
a flag structure. Trade entries are made on the upper channel breakout of flag
range. Exact opposite of this bearish flag.
Suresh
Baskaran: As the name suggests,
Flag & pole pattern consists of two parts- pole (sharp up move) and a flag (consolidation
or minor profit booking). Support and resistance line
of range bound Flag portion is either horizontal or trending downwards. Once
the resistance line of flag portion is crossed, stock will breakout on upside.
Target of the breakout move can be set as length of the previous pole above the
resistance line of flag portion.
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