ETH made a bearish flag, broke below the flag, went down almost equal to the flag width, and is on its way to pull back.
What Is a Flag? In the context of technical analysis, a flag is a price pattern that, in a shorter time frame, moves counter to the prevailing price trend observed in a longer time frame on a price chart. It is named because of the way it reminds the viewer of a flag on a flagpole.
How to Trade a Flag Pattern
Using the dynamics of the flag pattern, a trader can establish a strategy for trading such patterns by merely identifying three key points: entry, stop loss and profit target.
Entry: Traders typically expect to enter a flag on the day after the price has broken and closed above (long position) the upper parallel trend line. In a bearish pattern, the day after the price has closed below (short position) the lower parallel trend line.
Stop Loss: Traders typically expect to use the opposite side the flag pattern as a stop-loss point.
Profit Target: Conservative traders may want to use the difference, measured in price, between the flag pattern’s parallel trend lines to set a profit target. A more optimistic approach would be to measure the distance in dollar terms between the pattern’s high and the base of the flagpole to set a profit target.
لا يُقصد بالمعلومات والمنشورات أن تكون، أو تشكل، أي نصيحة مالية أو استثمارية أو تجارية أو أنواع أخرى من النصائح أو التوصيات المقدمة أو المعتمدة من TradingView. اقرأ المزيد في شروط الاستخدام.