Bull flag pattern
A bull flag is a sharp rise (the pole), then a short drift sideways or down (the flag). Learn the rules, the bear flag mirror, and tap the top of the pole.
A bull flag is a sharp rise, the pole, followed by a short drift sideways or down, the flag (on this site: a pole of at least 8% in at most 8 candles, ending at the highest high, then a flag of 4 to 12 candles that gives back at most 50% of the pole).
Practice: tap the top of the flagpole
How to identify it (the exact rules)
These are the rules this site uses to build and grade every chart. Traders do not all use the same numbers; ours are published so you can check every answer (see the methodology).
- Flag: a pole of at least 8% in at most 8 candles, then 4 to 12 candles giving back at most 50% of it, drifting sideways or down.
- The pole ends at the highest high of the chart; the flag is every candle after it.
- The flag's closes drift sideways or down (their best-fit line does not rise).
- Bear flag: the mirror image, a sharp fall then a pause that drifts sideways or up.
What it shows
A bull flag starts with a burst. Buyers push price up fast in a few candles, with little pullback along the way. Then the burst stops. Some early buyers take profits, and price drifts lower or sideways in a narrow band. The drift is calm and orderly, more like a rest than a reversal.
The question the flag asks is whether new buyers will absorb that selling. Everything hangs on one candle: the top of the pole, the highest point the burst reached. In the chart above, you tapped it. It is the line the flag drifts under, and the level traders compare every later candle with.
The parts of a bull flag
| Part | What it is | Rule on this site |
|---|---|---|
| Pole | The fast climb | At least 8% in at most 8 candles |
| Top of the pole | Where the burst ends | The highest high on the chart |
| Flag | The pause after the pole | 4 to 12 candles |
| Slope | Direction of the flag's closes | Flat or falling, never rising |
| Depth | How much of the pole the flag gives back | At most 50% |
Bear flag: the mirror image
A bear flag flips everything. The pole is a sharp drop to the lowest low. The flag is a short drift sideways or up, as sellers pause and a few buyers step in. The same proportions apply in reverse: a steep pole, then a short, shallow flag that wins back no more than half of the drop. Chart readers usually wait for a close below the pole's low before treating it as complete. The exercise on this page only shows bull flags.
Most often confused with: the pennant
A flag and a pennant both follow a pole, and both are short pauses. The difference is in the pause. A flag looks like a small channel: its edges run roughly parallel, often tilted against the pole. A pennant looks like a tiny symmetrical triangle: its edges converge to a point. In practice the two are read the same way, and many guides treat the pennant as a flag variant. The other common mix-up is with a real reversal. When the "flag" gives back most of the pole, it is no longer a pause in a rise; it is the rise being undone.
What it does not tell you
The pole looks obvious only after it has happened. While price is drifting in the flag, you cannot know whether the pause will end with a push to a new high or a slide. Most chart readers wait for a close above the top of the pole before they call the flag complete. Even then, the flag does not say how far price may run. The measured move convention adds the pole's height to the breakout price. It is a habit for drawing a reference level, not a forecast.
How reliable is it?
No reliable statistic exists for bull flags. The automated pattern study by Lo, Mamaysky and Wang (2000) did not include flags among the shapes it tested, and we found no peer-reviewed test with fixed flag rules that we could cite. Flags also suffer from a strong hindsight bias: charts shared online show the flags that broke out, not the ones that faded. A sharp rise followed by a pause is common, and most of the time nothing remarkable follows.
Where the idea is proven wrong
The idea is that the flag is a rest, and a rest is shallow and short. If the drift gives back more than half of the pole, the site no longer calls it a flag, because buyers have lost most of what the burst won. If the pause runs past 12 candles, the burst is old news. And if the flag's closes start trending up while staying under the pole's top, it is no longer drifting against the pole; it has become a slow climb of its own, which the site does not count as a flag.
Volume
Many descriptions say volume is heavy on the pole and lighter in the flag. In this exercise only price matters: you find the top of the pole from the candles' highs.
Frequently asked questions
What is the difference between a bull flag and a bear flag?
They are mirror images. A bull flag is a sharp rise followed by a short drift down or sideways; traders usually wait for a close above the pole's high. A bear flag is a sharp drop followed by a short drift up or sideways; traders usually wait for a close below the pole's low. In both, the pause should stay short and shallow.
How long should a bull flag last?
On this site, the flag lasts 4 to 12 candles after the top of the pole. Shorter than that, it is hard to tell from ordinary noise; longer, the pause has lost its link to the burst that came before it. Other sources use other limits. What matters is fixing the rule before you look, not after.
Is a bull flag the same as a pennant?
Not quite. Both are short pauses after a sharp move. A flag's edges run roughly parallel, like a small channel tilted against the pole. A pennant's edges converge, like a small triangle. They are usually read the same way and are often grouped together as continuation patterns.
How do you measure a bull flag target?
The usual convention takes the height of the pole and adds it to the price where the breakout happened. Treat it as a way to put a reference line on the chart, not as a forecast. Price often stops short of that level, and sometimes goes well past it.