As of 11/20/2024
Indus: 43,408 +139.53 +0.3%
Trans: 17,002 -26.31 -0.2%
Utils: 1,055 +1.25 +0.1%
Nasdaq: 18,966 -21.33 -0.1%
S&P 500: 5,917 +0.13 +0.0%
|
YTD
+15.2%
+6.9%
+19.7%
+26.3%
+24.1%
|
 46,000 or 43,000 by 12/01/202418,000 or 16,600 by 12/01/20241,075 or 1,000 by 12/01/202420,000 or 18,400 by 12/01/20246,100 or 5,800 by 12/01/2024 |
As of 11/20/2024
Indus: 43,408 +139.53 +0.3%
Trans: 17,002 -26.31 -0.2%
Utils: 1,055 +1.25 +0.1%
Nasdaq: 18,966 -21.33 -0.1%
S&P 500: 5,917 +0.13 +0.0%
|
YTD
+15.2%
+6.9%
+19.7%
+26.3%
+24.1%
| |
|
46,000 or 43,000 by 12/01/202418,000 or 16,600 by 12/01/20241,075 or 1,000 by 12/01/202420,000 or 18,400 by 12/01/20246,100 or 5,800 by 12/01/2024 | ||
Statistics updated on 8/27/2020.
I automated cataloging of flags to make identification of the trend start and end repeatable, and used linear regression of the average of the high and low price within the flag to determine flag tilt (then reviewed trend start, end, tilt, and changed them as necessary).
For more information on this pattern, read
Encyclopedia of Chart Patterns Second Edition
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Flags appear as small rectangles usually tilted against the prevailing price trend and mounted at the end of a flagpole. If you don't have a straight-line (or a quick move) price run (the flagpole), then you don't have a flag. The best performing flags have a long, near vertical flagpole.
The above numbers are based on hundreds of perfect trades. See the glossary for definitions.
* Performance results for flags are based on the short-term price swing, not the change from the breakout to the ultimate high or low as in most other chart patterns. That's why I don't show a rank and that's why the average rise/decline is so small.
| Characteristic | Discussion |
| Price trend | Can be any direction leading to the chart pattern. |
| Shape | Looks like a small rectangle often tilted against the prevailing price trend. |
| Trend lines | Price moves between two parallel, or near parallel, trendlines. |
| 3 weeks | Flags are short, less than 3 weeks long. Patterns longer than that are rectangles or channels. |
| Flagpole | The flagpole which leads to the flag should be unusually steep and last several days. |
| Volume trend | Downward trend 74% (up breakouts) to 77% (down breakouts) of the time. |
| Breakout | Upward 60% of the time. |
| Trading Tactic | Explanation | 
The Measure Rule
 Half Staff
Flag Tilt
Tight v. Loose
|
| Measure rule | There are 4 combinations of the measure rule computation. I show two on the right. The other two targets are just the start of the inbound trend (A). Compute the height from the start of the price swing (point A in the measure rule figure to the right) to the end of the price swing (B) and then multiply it by the above “percentage meeting price target.” Add it (upward breakouts) to the bottom of the flag (C) or subtract it (downward breakouts) from the top of the flag (C) to get the target (D). | |
| Half staff | Sometimes, the flag will appear midway in the price trend. The half staff figure to the right shows an example, (move A equals B). | |
| Flag tilt | The best performance comes when the inbound trend is upward leading to a flag which tilts downward. An example of that is the Half Staff picture on the right. | |
| Flat base | If the flag appears above (upward breakouts) or below (downward breakouts) a flat base then expect the move to be a large one. | |
| Tight flags | A tight flag performs better than a loose one. A loose flag is one in which price meanders, pokes outside the trendline boundary, contains white space, or looks jagged. The tight v. loose figure to the right shows an example. | |
| Yearly low | The best performers occur when the breakout is within a third of the yearly low. |
The above figure shows an example of a flag chart pattern. The price swing leading to the flag begins at A and ends at the top of the flagpole, B. A short flag sees price consolidate for a few days before breaking out upward and trending higher.
-- Thomas Bulkowski
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