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A flag pattern can happen at the early phase of the trend.
Conditions:
-A steeper pole
– rectangular sideways trend that should not drift downwards.
-positive breakout on the same side with high volume
– takes 2 weeks to form this pattern
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The shape of price movement display in flag is called flag pattern.
The steeper pole present in inclined at 70 to 80 deg for minimum 2 days price movement and side way movement for 3 to 7 days and when breakout the side way movement with high volume in upper direction, then we understand the trend is up.
Flag pattern is similar to flag which shows bullish trend.
conditions:
The steeper pole should be formed and then the rectangular sideways movement should be noticed for 3-4days and break out should be made as BULLISH,at the same time the volume should be more in that day.
a flag pattern is formed when a steeper pole of 75 -80 degree is formed within 2-3 days and then the rectangular price movements happen for 3-7 days.
volume should be low in the range area, breakout should be in same direction. long position to be created if stock is giving same side breakout. when the breakout is happening the volume should be high.
THIS is a short term pattern which is a powerful one witnessing surge
A sudden steep rise in 3days forming the POLE of the flag making nearly 75* to 80*(The pole is visible in candle stick chart)
AFTER RISE , THE STOCK CONSOLIDATES for 3 to 7 days during which the volume will be low
The price should not drift down during( consolidation) the flag formation
IF the price moves with volume above the consolidation area( ie in the direction of the pole ) bull trend is assured
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