What is the difference between a bull flag and a Bear Flag?

Bull flag and bear flag share the same traits: Traits of Flag Patterns include support and resistant levels, flag, flag pole, breakout points and price projections. While a bull flag validates that the preceding uptrend will continue, the bear flag ensures that the preceding downtrend is likely to occur.

What is a Bear Flag & how does it work?

The bear flag is an upside down version of the bull flat. It has the same structure as the bull flag but inverted. The flagpole forms on an almost vertical panic price drop as bulls get blindsided from the sellers, then a bounce that has parallel upper and lower trendlines, which form the flag.

Why do Bears get blindsided on Bull Flags?

On bull flags, the bears get blindsided due to complacency as the bulls charge ahead with a strong breakout causing bears to panic or add to their shorts. Once the stock peaks out, the bears regain some confidence as they add to their short positions only to get trapped again when the breakout forms causing more short covering.

How to use Bull and Bear Flag patterns on phemex?

On Phemex, you can combine the bull and bear flag patterns with other indicators to help plan out your trades. The best indicators to combine with flag patterns are popular indicators such as the Relative Strength Index ( RSI ), which can help show if the existing trend is oversold (bullish) or overbought (bearish).