Stocks Trading High Tight Flag

A high tight flag pattern appears quite rarely in stocks trading. According to William O’Neil this pattern does not occur in more than one or two stocks during a bull market. The pattern begins when the stock moves approximately 100% to 120% in a very short period of about 4 to 8 weeks. There is considerable volume increase in this initial uptrend. Then the pattern corrects sideways in 3 to 5 weeks by no more than 10% to 20% from the previous high. The buy point is at the end of the sideways period at the first sign of an increase in price and volume.

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