What Is a Flag Pattern – And Why It’s a Powerful Continuation Signal

Flag patterns are among the most reliable continuation patterns — meaning the trend is likely to continue after a brief pause. 🔹 Components of a Flag: Strong up-move (flagpole) Followed by a small downward/slanting consolidation (the flag) Breakout above the flag = Resumption of trend ✅ Strategy: Enter on breakout above flag Volume should rise on breakout candle SL = Below flag low TGT = Length of flagpole projected from breakout 📌 Example: Stock moves from ₹150 → ₹200 (flagpole), then consolidates ₹190–₹195 for a few days Breakout at ₹196 with high volume = Entry Target = ₹200 + ₹50 = ₹250 approx. 🧠 Flags work well in momentum stocks and during trending markets.