What are Bull and Bear Flag patterns?

Bull and bear flag formations are price patterns which occur frequently across varying time frames in financial markets. These patterns are considered continuation patterns in technical analysis terms, as they have a habit of occurring before the trend which preceded their formation is continued.

How do bear flag patterns work?

Bear flag patterns work in the same way as bull flag patterns, just in reverse. Every good bear flag pattern trade should be made up of three elements: Stop Loss: Most traders use the opposite side of the flag pattern as a stop-loss to protect themselves against the price moving in the other direction.

What does a bear pennant mean?

When these lines converge, they are typically called a bull pennant or bear pennant, depending on the type of flag. Like bull flags, bear flags also turn out to be true most of the time. However, they represent a bit more than a brief lull in a bigger move lower.

What is a 'bull' and 'bear' in the stock market?

In the investing world, the terms "bull" and "bear" are frequently used to refer to market conditions. These terms describe how stock markets are doing in general—that is, whether they are appreciating or depreciating in value. And as an investor, the direction of the market is a major force that has a huge impact on your portfolio.