Concept
Bull/bear Flag
Bull/bear Flag is a Chart & Candlestick Patterns concept. The Library holds 2 implementations, each one a working definition you can pull into Quant.
Top Bull/bear Flag indicators
2 total
What is a Bull/bear Flag?
A flag is a brief continuation pattern: a sharp, near-vertical impulse leg (the pole), then a shallow countertrend drift inside a narrow parallel channel (the flag), then a break back in the pole's direction. A bull flag has an up pole with a downward or sideways flag; a bear flag mirrors it. The drift is the mechanism: profit-taking gets absorbed without price giving back much ground, which implies the other side never regained initiative.
The classic volume signature is expansion on the pole, contraction through the flag, and expansion again on the break, and the measure rule projects the pole's height from the breakout point for a first objective. The premise is trend continuation, so flags drawn against a higher-timeframe trend, or after a move has already run far, fail routinely; the shape alone is not the edge.
How traders use it
- As a continuation entry: buy (or sell) the break of the flag channel in the pole's direction, stop beyond the flag's far edge, first target from the measured move.
- As a trend-strength read: shallow, low-volume flags holding the upper part of the pole suggest one-sided conditions, while deep, sloppy flags retracing half the pole or more read as ordinary pullbacks with weaker continuation logic.
- As a timing tool inside a mapped trend: many traders only take flags forming above support or a rising average, treating the flag as the entry mechanic rather than the reason for the trade.
Related concepts · Continuation chart patterns
Concept family
Chart & Candlestick Patterns
84 concepts mapped · 46 in the Library
Bull/bear Flag FAQ
How much can a flag retrace before it is no longer a flag?
There is no official cutoff. Common guidance keeps a flag shallow, retracing well under half of its pole, and brief, a handful of bars rather than a full swing. The deeper and longer the drift, the more it behaves like an ordinary pullback or a developing range, and the weaker the claim that sellers were merely being absorbed.
What is the difference between a flag and a pennant?
Both follow a sharp pole and both are continuation pauses. A flag drifts inside roughly parallel boundaries, while a pennant compresses inside a small converging triangle. The trading treatment is essentially identical: break in the pole's direction, measured target from the pole. The distinction is descriptive rather than tactical, and many scanners group the two together.
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