Bullish Flag is occurred when market moves upward followed by a pause or sideways to lower trading for a few price bars/candlesticks, then market continues to move upward. The flag is usually too short in duration to actually have reaction highs and lows, the price action just needs to be contained within two parallel trend lines. Draw bullish trend line on chart. It is located just before the flag pattern. Then identify the long candlestick which is similar to a pole. Usually market price moves higher and creates at least the same length as poles length. When market price reach the same lenght as pole's (after flag pattern) then it is the right time for us to exit from market. Some forex book might recommend you to use this pattern to determine buy signals. But I don't. Since this technique is not that accurate. But this technique helps a lot when I already have open position. That means when I buy a certain pair and I found Bullish Flag pattern, Ill hold the order to exit after market price creates the same length with the poles length. Click here to read more about this article and see some examples related to the topic. |
