Definition
Like a flag, a short pause after a sharp move, except the pause narrows into a small, tight triangle instead of drifting between parallel lines.
The story
After a sharp rise, price swings get smaller and smaller, squeezing toward a point. Some traders read it much the way they read a flag and watch which way price leaves the squeeze.
Why you'll see it
Pennants are usually taught alongside flags as short pauses within a move.
Connects to
We explain why it moves markets. What you do with it is your call. Commentary and education only. Not financial advice. All terms