Jan Soybeans Bull Flag breakout.
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Started by mikempt - Nov. 17, 2019, 12:31 p.m.

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By metmike - Nov. 18, 2019, 12:44 p.m.
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Thanks Mike!

We have disagreed on this a half dozen times but that is a BEAR flag.

By definition, flags/pennants are continuation patterns and beans are clearly in a downtrend, since the double top highs last month(with the June highs), so the breakout from the flag, confirmation would result in the previous  downtrend resuming its downward movement.


If we break up wards out of this sort of formation, then its certainly bullish but that movement is in the opposite direction of the previous move(though I guess one could still call what they wanted). One could say that a low is in or we help support or that this is a short term bullish bounce or that we are starting a new uptrend.

But it doesn't really matter what you call it. If this price formation provides you with a high confidence trading signal that you make money on......that's the bottom line.


In this case, however, your "bull" flag breakout was a fake out(which happens all the time with, even the most reliable signals) . Beans are sharply lower today and back to the lows in the flag formation.


By metmike - Nov. 18, 2019, 12:47 p.m.
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CHART EXAMPLES OF FLAG AND PENNANT PATTERNS / COMMODITIES


http://www.chartpatterns.com/flagandpennantcharts.htm


"BULL" PENNANT IN AN UPTREND (BULLISH)

"Bull" pennant in an uptrend.  After a month long rally, the market takes a five day breather and continues even higher.  Volume dips briefly and then picks up on the breakout.  


"BEAR" PENNANT IN A DOWNTREND (BEARISH)

"Bear" pennant in a downtrend.  This pattern came right after a 'bear' flag breakout.  (Can you see it?) This pennant also presents only a brief pause before the market reasserts itself in the direction of the trend (down.)  Volume dips in the pattern and jumps as the market breaks out and gaps lower.    

By metmike - Nov. 18, 2019, 1:07 p.m.
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Mike,

Your knowledgeable contributions here are much appreciated, regardless of the small disagreement in the verbiage of what to call this chart pattern.


Always like your charts.

By mikempt - Nov. 19, 2019, 10:32 a.m.
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Its all good! I seem to make money to the long side with this pattern $$$.

By cutworm - Nov. 20, 2019, 8:04 a.m.
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met, I think the difference in the 'bear' flag breakout shown in your 2nd chart (circled) is that in the pennant portion of the flag it drifts upward, and in MPT's bear flag it drifts downward.