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Stock Price Behavior Analysis Course

Lesson 18: Analysis of Multi-Candle Patterns (2) — Trend Continuation Patterns

In the previous lesson, we learned about reversal patterns. Today, we will look at trend continuation patterns. These patterns appear in the mid-stage of a trend and signal the market's "rest before departing".

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1. Flag

Features:

• Usually appears after a significant rise or fall, with prices showing a slight reverse consolidation (e.g., a small drop after a rise).

• Looks like a flag hanging at an angle.

Meaning:

A resting period after a strong rally, often followed by a continuation of the rise (or fall) after the consolidation ends.

➡️ A breakout above/below the flag pattern can be seen as a reactivation signal.

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2. Symmetrical Triangle

Features:

• High points are getting lower, and low points are getting higher, forming a converging structure.

• Trading volume gradually decreases, eventually breaking out either upwards or downwards.

Meaning:

A tug-of-war between bulls and bears, waiting for the forces to concentrate before an explosion. The direction is uncertain, and one must observe the breakout direction before acting.

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3. Box Range

Features:

• Prices oscillate back and forth within a clearly defined range, resembling a "box".

• Can be seen as the main force accumulating positions.

Meaning:

The longer the consolidation period, the stronger the potential breakout in the future.

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These patterns are powerful tools for trend traders, helping you find opportunities to re-enter during a trend.