TSLA
Tesla Down Cycle + Bear Flag: Our cycle work suggests we are still in a down cycle, and we have identified a bear flag pattern. We will wait for a buy alert before entering a position. A "bear flag" is a technical analysis pattern that can occur in financial markets, particularly in stocks. It is considered a continuation pattern, indicating that the current downtrend is likely to continue after a brief pause or consolidation phase.
The pattern resembles a flagpole, where the initial downward move forms the pole, followed by a period of consolidation or sideways movement, creating the flag. The flag is characterized by lower highs and lower lows, forming a downward sloping channel or a parallel trendline structure.
Traders often look for a breakout below the lower trendline of the flag as a confirmation of the continuation of the downtrend. This breakout is typically accompanied by increased volume, signaling renewed selling pressure. The price target for the bear flag pattern is often estimated by measuring the length of the flagpole and projecting it downward from the breakout point.
Overall, the bear flag pattern provides traders with a potential opportunity to capitalize on a downward trend continuation by entering short positions after the confirmation of the breakout.