Web Trader MT5
A continuation pattern in a downtrend. The chart drops sharply (the “flagpole”), then trades sideways or slightly upward in a tight range (the “flag”), and then resumes falling. Technical traders read the flag as a pause where short-sellers take profits and weak hands try to call a bottom, before the dominant trend reasserts itself.
The shape matters. A textbook bear flag has a clean, steep flagpole, a short consolidation that slopes gently against the prevailing trend (so, slightly upward in a downtrend), and falling volume during the consolidation. Volume should pick up again on the breakdown out of the flag.
Bear flags fail more often than they work, which is true of most chart patterns honestly examined. But when they do work, they work fast, the implied move out of the flag is usually about the same length as the flagpole that preceded it. That’s the rule of thumb traders use to set targets.
Example: Bitcoin in mid-2022 traced a textbook bear flag. After dropping from around $40,000 to $30,000 in May, it consolidated between $28,000 and $32,000 for several weeks, then broke down in June toward $20,000. The breakdown’s magnitude roughly matched the prior flagpole, which is the pattern’s classic completion.
