BASIC BEAR FLAG PATTERN
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| Below is the basic Bear Flag pattern. Everything stated on the previous page about Bull Flags applies to Bear Flags, but in reverse. A Bear Flag will slope up gradually against the steep downtrend. Again, the measuring implications are the same. Distance "A", or the flag pole, and distance "B", should be about equal. |
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BASIC BEAR FLAG PATTERN |
| And again, I would prefer to see the Bear Flag rally in to some type of resistance such as a Fibonacci level, old bottom, or moving average, or combination thereof, so I can feel warm and cozy about my short. See chart below. |
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| Sometimes you will see a bear flag form and it will be said to be "hugging" a moving average. This generally refers to the flag forming along an upsloping moving average. Usually, significant upsloping moving averages will quickly repel sell-off attempts, but when you see the flag hugging it, with no panic like buying, watch it closely, because it is trying to tell you, that it is very weak, and even a moving average can't turn it up. See the chart below for an example of this. |
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