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Flags and pennantsFlags and pennants are continuation patterns. They usually represent only brief pauses in a dynamic market. They are typically seen right after a big, quick move. The market then often takes off again in the same direction. (Volume usually drops off during the pause with an increase on the breakout.) Lower tops and lower bottoms characterize bullish flags, with the pattern slanting against the trend. However, unlike wedges, their trend lines run parallel. Once the high of the upper trend line gets broken, I will enter a long position. My initial stop is at the lower trend line. I quickly raise my stop to the last low once it is established after the breakout. Bearish flags make higher highs and higher lows. “Bear” flags also have a tendency to slope against the trend. Their trend lines run parallel as well. Note: Pennants look very much like symmetrical triangles. But pennants are typically smaller in size (volatility), duration, and their trend lines don’t run parallel. Since they are so similar, I will not describe them separately.
I will leave at that to avoid complicating things so click here to move on to the triangles. 
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