The Bearish Pennant – A powerful continuation pattern!

The Bearish Pennant is a classic continuation pattern that signals the market is likely to resume its downtrend after a short consolidation. It consists of two key components:

🔻 The Flagpole – A strong, impulsive move downward, indicating high selling pressure.
🔻 The Pennant – A brief consolidation with lower highs and higher lows, forming a small symmetrical triangle. This represents a temporary pause before the next leg down.

How to trade it?
1- Identify a sharp downward move (the flagpole).
2- Wait for price consolidation within the pennant.
3- A breakout below the pennant’s lower trendline confirms continuation.
4- Target = The length of the flagpole projected downward from the breakout point.

Why does this happen?
After a strong downward move, some traders take profits, causing consolidation. However, when sellers regain control, the trend resumes with force, leading to another leg down.

⚠️ Pro Tip: Look for increasing volume on the breakdown to confirm the move!