Bull Flag

A bull flag is a continuation pattern in which a sharp upward move — the flagpole — is followed by a brief, shallow pullback or sideways drift that slopes gently downward, forming the flag, before price breaks out and resumes the advance. The pattern reflects healthy trend behavior: after a strong impulse, early buyers take profits and the market rests, but selling stays weak and orderly, showing the pullback is consolidation rather than reversal.

For example, suppose Solana rallies from $140 to $170 in three days (the pole), then drifts between $170 and $162 for a week in a tight downward-sloping channel on declining volume (the flag). A breakout above the flag's upper boundary on expanding volume triggers the pattern, and the classical measured target adds the pole's height to the breakout point — around $192 in this case.

Declining volume during the flag and a volume surge on the breakout are the standard quality checks. A common misconception is that any pause after a rally is a bull flag; if the pullback retraces most of the pole, drops on heavy volume, or drags on far longer than the pole took to form, the odds shift from continuation toward reversal, and traders treat a close below the flag's lower boundary as the pattern failing.