Bear Flag Pattern

Wait for price to break below the lower flag boundary. Enter short with a stop-loss above the flag's high. Target is the flagpole length projected down from the breakdown point. Volume should increase on breakdown.

Bear flags have parallel trendlines and are bearish continuation patterns. Falling wedges have converging trendlines and are typically bullish reversal patterns. The trading implications are opposite despite both sloping downward.

Yes. If price breaks above the upper flag boundary instead, it's a failed bear flag and can lead to a strong upward move. Always use a stop-loss and be prepared to reverse your bias if the pattern fails.