bull flag trading strategy: What is a Bull Chart Pattern in Crypto and How to Identify One


In terms of managing risk, a price move above the resistance of the flag formation may be used as the stop-loss or failure level. In terms of managing risk, a price move below the support of the flag formation may be used as the stop-loss or failure level. A breakout is when the price moves above a resistance level or moves below a support level.

bull flag chart
bullish flag formation

It can be a simple way to enter on breakouts with lower risk. There are a few variations on the classic bull flag pattern. They all feature strong momentum followed by a consolidation period. But they’re different enough to have their own categories. It is completely up to the trader when they want to sell. However, they should keep an eye out if the price breaks out of the consolidation range to the downside.

Strategy 2: Bull Flag and Trading Volumes

If the price moves in your favor, then trail your stop loss with the 50-period Moving Average. If the price breaks above the swing high, go long with stop loss 1 ATR below the low of the Bull Flag. In such market conditions, there is a lot of “meat” for the trend to continue and the only way to ride it is to trail your stop loss. You don’t want to set your stop loss at obvious levels like Support & Resistance, swing high & lows, and etc. There are times a Bull Flag Pattern can form when the market is in range, at Resistance. In my experience, the best time to trade the Bull Flag Pattern is when it occurs just after a breakout.

Investors in the bull flag trading strategy market often depend on technical analysis to forecast future price trends. A technical analysis chart pattern called the ‘bull flag pattern’ indicates that an asset’s value is about to increase. Traders of bull and bear flag patterns might hope to see the breakout accompanied by a high-volume bar. A high-volume bar to accompany the breakout, suggests a strong force in the move which shifts the price out of consolidation and into a renewed trend.

One of them is to have a pre-determined profit target based on length of flag pole. Well, it’s a term I coined when the market breaks out of a range and then does a pullback for the first time. The ending point of the pasted trend line signals a level where we should consider taking our profits off the table.

Bull Flag Pattern Trading

Instead, it squeezes and forces shorts to cover. Longs also jump in when they see the stock rallying further. A line connects the peaks of all the rally candles that form the flagpole. After the strong move higher, the market becomes overbought so the market needs to take a “rest”. Here’s where you can expect a potential Bull Flag to form. A small break before the market continues moving in the same direction.

  • In the example above, you can see the line drawn out on the bottom of the flag pattern.
  • We use the same GBP/USD daily chart to share simple tips on trading bullish flags.
  • Then you want a tight consolidation where the price begins to move downward or countertrend on lower volume.
  • We do not track the typical results of our past or current customers.
  • However, it is important to understand that not all Flags are equal, and before you trade that pattern, you might want to get familiar with its important nuances of it.
  • The bull flag pattern is great for newer traders. typically does not decline during the consolidation period as downward trends are often a vicious cycle driven by investor fear over falling prices. As such, the volume is upwards as the remaining investors feel compelled to take action. A trader’s investment goals and their execution of trading strategies determine whether they get rewards or losses. The bull flag pattern is commonly used by traders as it shows the presence of a strong uptrend. With this pattern, traders who missed the initial surge of a cryptocurrency’s upward movement can still profit.

The psychology behind Bull Flag

Recently, we discussed the general history of candlesticks and their patterns in a prior post. We also have a great tutorial on the most reliable bullish patterns. This is a great lesson on managing risk and respecting your stops.

  • A sharp uptrend should always precede the pattern followed by a correction.
  • The pennant is another variation of the bull flag.
  • So as soon as they see a stock’s price dip a little, they jump in and buy shares.
  • When they’re done buying the needed shares, the price will push higher, break the flag pattern again, and most likely will continue the up trend.
  • To buy a pullback using bull flags, it’s a good idea to incorporate another technical analysis tool.

But keep in mind that like any stock pattern, a bull flag can fool you. If there’s a negative catalyst about the company, the breakout you’re expecting may not happen. To maintain the trend, the cryptocurrency breaks out of the consolidation pattern at a relatively solid volume. To measure the Take-Profit target of the bull flag, you need to count the distance between the start of the trend and the correction. This distance should be counted from the breakout of the upper boundary of the bull flag.

The simple bull flag guidelines here accommodate a wide range of continuation patterns. Hence, they provide plenty of opportunities for closer analysis. The more confident you are of the bullish bias, the more likely you would trade a bull flag breakout. Here is a BTCUSD example showing two instances of the bull flag chart pattern.

Trading Strategies for Disney Stock Before And After Q1 Earnings – Walt Disney (NYSE:DIS) – Benzinga

Trading Strategies for Disney Stock Before And After Q1 Earnings – Walt Disney (NYSE:DIS).

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Your exit target is the length of the flagpole added to the bottom of the flag. On a heavily shorted stock, the dip is due to longs locking in profits and shorts shorting more. Place stop orders below the bottom of the consolidation pattern. But it’s just as easy to lose control of your trade management process and end up with a net loss. But regardless of which length you use to project the target, the market would have fallen short.

Bull Flag Pattern in Trading. Open Long Trades

Consider using a Libertex demo account that allows traders to practise without any risk for their funds. The account provides real-time trading conditions and a wide range of CFDs trading underlying assets. The bull flag isn’t a difficult pattern that can occur at any time and for any asset. It provides a signal of the uptrend’s continuation. The bull flag is a well-known pattern worldwide. If the trading volumes rise after the correction and the price breaks above the bull flag’s upper boundary, it’s a sign of the trend’s continuation.

pattern to form

However, following a bull flag pattern is not a completely risk-free crypto trading strategy. Any trading market involves risk, and in the comparatively volatile crypto markets, the most significant risks are instability and unexpected price swings. The bull flag chart pattern is a short-term trend and may last anywhere from one to six weeks. If a trader can identify a bull flag chart pattern precisely, he can forecast the upcoming bull trend and leverage it to make profits. After the uptrend, the price will typically enter a period of consolidation or sideways price action. This is often characterized by a narrow range and lower volume and is referred to as the „flag“ portion of the pattern.

By using indicators like Fibonnaci extensions and retracement… This would give us confidence, not only that the move might not be finished, but also as to where our target could be set. A pennant is a symmetrical triangle that is formed in a horizontal consolidation pattern. As the pennant narrows into its apex, it can be difficult to determine which direction it will resolve.

account requires

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account requires
trading account

Opinions, market data, and recommendations are subject to change at any time. Past performance is not indicative of future results. So the trading fees can be depending on your asset to trade. You can choose between the spread account or the commission account. This also updates focus on particular products, including predictions, influences, and much more. – In the following review, we will prove theonline brokerATFX and show you the conditions for traders.Nowadays it is very hard to find a goodForex Broker.

deposits and withdrawals

They also provide an economic calendar and free quarterly market outlook containing longer-term analysis that covers all of the markets ATFX offers. There is one unusual practice that the broker takes a one-minute trading break each day around midnight (GMT+2 or GMT+3 during Daylight Savings Time). Or European based day traders, it may not suit those who typically hold positions for the long-term or trade the Asia session. It could also impact trading robots overnight as they may fail to enter or exit positions at that time. ATFX is an online forex and CFD broker founded in 2014 that has a global presence and supports customers in over 16 different languages. The company has its main offices in London and Limassol, Cyprus, although it also has offshore offices in Kingstown, St. Vincent, the Grenadines and Mauritius.

ATFX Broker has very good service

If you are based in the UK, the spread betting option might be attractive to you as this method of trading is capital gains tax-free. There is also an Introducing Broker Partnership Program. This allows partners to earn rebates for clients they refer.

  • We also compared ATFX’s fees with those of two similar brokers we selected, XM and ETX Capital.
  • The commercialisation of services and the acquisition of clients can only be carried out in Spain by an authorised entity or through a tied agent.
  • ATFX cannot be used in Cuba, Japan, Iran, Canada, or the USA either.
  • The ATFX minimum deposit for the Standard Account is just £/€100, for which you get a commission-free trading account with market spreads.
  • Find Your Broker We helped new traders to find their path.

It will be interesting to observe this broker in their approach and handling of the market. ATFX is a recognised broker regulated by the Financial Control Authority of UK and others, meaning transparency is not an issue due to regular audits. AFTX is a trustful broker which provide a lot of good webinar and analytic tools. ATFX has improved tremendously over time, substantially good effot to ease processes for traders. I prefer ATFX as they offer a wide range of products and advise better than anyone and best of all with excellent service.

They are also available for download in the Analysis section of ATFX. They include a number of older reports so you can view historic information. As with the market reports, the Fundamental Commentary is from a third-party and ATFX does not take responsibility for accuracy.

It also atfx review the full flexibility of the Desktop platform plus advanced charting. Pending order options include Buy Limit, Buy Stop, Sell Stop, and Sell Limit. All pending orders connect to company instructions within the server. The pending order is triggered, then transacted and executed in the form of a market order. This occurs when the market price reaches the correct point.

The Trustpilot Experience

ATFX chose to sponsor this particular event since it began in the UK and is promoted in regions worldwide. Additionally, the Duke of Edinburgh Cup is a known charity that has Royal Patronage. This lines up with the philosophy of ATFX, which further encouraged the broker to sponsor the event. This particular event is long-standing, with 18 years of events. Over 20 countries from five continents have participated and there have been over 134 tournaments. Since ATFX is a regulated firm, it has a clear complaint-handling procedure.

In the process, they reached out to us immediately, and after sending our documents, our got validated almost instantly. However, our validation email was sent in Italian, which was surprising as our earlier discussion was in English. To have a clear overview of ATFX, let’s start with the trading fees. Non-trading fees include charges not directly related to trading, like withdrawal fees or inactivity fees. To get things rolling, let’s go over some lingo related to broker fees.

Good customer support

Yes, ATFX is authorized and regulated by both the Financial Services Authority in the UK, and the Cyprus Securities and Exchanges Commission. Learn Trading financial markets has never been easier. Compare broker See what benefits one offers over the other.

There are several types of accounts available, including for Professional Clients. For convenience, ATFX offers an updated list of trading conditions for each individual asset. These are divided by category, such as forex majors, minors, and exotics.

The report has sentiment figures related to both small and large players. It also includes the main strategies and technical for traders, whether they are contrarian or conformist. MetaTrader 4 for Windows has multilingual trading support plus multi-currency support. There is also a VPS service for connectivity all day long. MT4 Desktop offers custom indicators and the ability to customize libraries, EAs, and scripts. Market orders are sent to the market, then executed at the market’s tradeable price.

  • Trading Central also includes advanced features such as adaptive candlesticks that recognize candlestick patterns in real-time continuation and reversal.
  • MiFID regulates financial instrument markets for providing investment services as well as activities, specifically in the European Economic Area.
  • Additionally, it constantly reviews its product range.
  • You should never invest money that you cannot afford to lose.
  • They span categories such as general, CFDs, and spread betting.

We recommend the FCA-regulated entity, because it has the highest investor protection amount at £85,000, while the FCA is one of the best financial regulators. ATFX is regulated by several authorities – including the top-tier FCA, which grants strong investor protection. However, ATFX is not listed on a stock exchange and doesn’t disclose financial information.

The Financial Services Compensation Scheme is available to clients in organizations regulated by the FCA. The scheme comes into play in the rare case that ATFX cannot satisfy its repayment claims. In this situation, the FSCS provides as much as £50,000 in compensation per person for eligible investments.


It is available in the United Kingdom, which includes England, Scotland, the Channel Islands, Northern Island, and Wales. Additionally, ATFX Global Markets Ltd. operates from Limassol, Cyprus. As such, this section of ATFX is under regulation from CySEC, the Cyprus Securities and Exchanges Commission.

A super choice for UK and EU traders

It can also be a useful tool for beginner traders who need to hone their skills. Or advanced traders can use the demo account to test new strategies. Trading with ATFX gives clients access to an FCA-regulated broker for trading CFDs and forex. The goal of ATFX is to deliver the best possible trading experience. The broker has a client portal that is state-of-the-art and relies on the leading encryption systems. Trading is done via MetaTrader 4 with support for all devices, both mobile and desktop.