The flag pattern is encompassed by two parallel lines. The price is not squeezed
by the trend lines, but it is moving inside the channel formed by the trend lines.
Flags are usually seen as the market pauses after a big move before
continuing its main trend.
All the presented patterns above are in an uptrend. The uptrend does not need
to be perfect, the price before the pattern is just rising. Chart patterns after a
downtrend are similar. We will focus only on continuation patterns, that is,
buying in an uptrend and selling in a downtrend. You may hear about reversal
patterns, but trading against the trend requires a lot of experience. Many banks
have crashed and many fortunes were lost because of stubborn traders trying
to pick the tops and bottoms. Trend is your friend, so keep it simple!
How to trade chart patterns
Now it's time to reveal the definite strategy to enter an order, place your Stop
Loss and take a profit, so you don't need to watch the market and you don't let
your emotions control your trading.
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