What is a Bear Flag stock chart pattern?

The bear flag stock chart pattern is a sign that a bearish trend will continue. The flagpole of the pattern represents a rapid decrease in price – and such abrupt changes lead to uncertainty. Even the most bearish trader will stop to think whether or not further shorting is warranted.

What is a Bear Flag chart?

By recognizing bear flag patterns, traders can make more informed decisions about when to enter or exit a position, and how to manage risk. A bear flag chart is a pattern that appears when there is a significant price decline in an asset, followed by a period of consolidation, which can result in a continuation of the downtrend.

What is a Bear Flag?

The bear flag is the inverse version of the bull flag. The bearish candlesticks that form the flagpole are formed by panic selling. Typically, flag poles to the downside will sprout near some major level of support. Volume tends to pick up, too, further creating the pattern. That being said, some bulls get blindsided by the bears, a bull-trap.