US $ Positional report
Flag Bullish
Chart Pattern
Implication: A Flag
(Bullish) is considered a bullish signal, indicating that the current uptrend
may continue.
Description: A Flag
(Bullish) follows a steep, or nearly vertical rise in price, and consists of
two parallel trendlines that form a rectangular flag shape. The Flag can be
horizontal (as though the wind is blowing it), however it often has a slight
downtrend. The vertical uptrend, that precedes a Flag, may occur because of
buyers' reactions to a favorable company earnings announcement, or a new
product launch. The sharp price increase is sometimes referred to as the
"flagpole" or "mast".
The rectangular flag shape is the product of what
technical analysts refer to as consolidation. Consolidation occurs when the
price seems to bounce between an upper and lower price limit. This might occur,
for example, in the days following a positive product announcement, when the
excitement is starting to subside, and fewer buyers are willing to pay the high
price that was commanded just a few days before. But, at the same time, sellers
are unwilling to sell below a lower support limit.
A bullish signal occurs when the price rebounds beyond
the upper trendline of the Flag formation, and continues the original upward
price movement. This is considered a pattern confirmation.
Trading
Considerations:
Possibility
of Price Reversal: In
some rare cases, the price will break against the original price movement, and
create a reversal trend. The pattern reversal may be signaled during the Flag
formation by a sharp increase in volume, as opposed to the more typical decrease.
Target Price: It is
commonly held that the length of the flagpole indicates the potential price
increase. When the Flag completes, the price typically jumps to replicate the
height of the original flagpole, while continuing in the direction of the
inbound trend.
Expected Target: Dollar Index is trading near the support level of 79 and is showing sign of reversal and till the time this support is holding I feel it will cross the level of 81 and test the level of 85 which is higher trend line and crossover above 85 will confirm the upside breakout where the pattern confirmation will be seen. Bull Flag pattern is still in formation stage where it’s reverting from point D and expected Breakout is seen at Point E at 85 level. Pole Difference is seen at 11.4 and after the breakout at 85 my expected target comes to 90 to 96.4 levels in long term.
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