One of the first things to know about rising and falling wedge patterns, is that they’re a great indicator of an upcoming reversal. Much the same as other wedge patterns, they’re formed by a consolidation period representing either distribution or accumulation. While both rising and falling wedges can form over a period of any length, typically the longer the...
A Bear Flag is a price action within the context of a downtrend that produces an orderly price increase consisting of a narrow trend range comprised of higher swing/pivot highs and higher swing/pivot lows. The success of a Bear Flag can be greater after a significant downside move due to the possible increase of overhead resistance. Bear Flags can be stronger...
The Double Bottom Reversal is a bullish reversal pattern typically found on bar charts, line charts, and candlestick charts. As its name implies, the pattern is made up of two consecutive troughs that are roughly equal, with a moderate peak in-between. It is important to remember that the Double Bottom Reversal is an intermediate to long-term reversal pattern that...
Flags and pennants are continuation patterns. They are traded in the same way, but each has a slightly different shape. The terms flag and pennant are often used interchangeably. A flag or pennant pattern forms when the price rallies sharply, then moves sideways or slightly to the downside. This sideways movement typically takes the form or a rectangle (flag) or...