Built by Traders, for Traders

Ross Givens

Stock Trader & Educator

How to Trade the Market’s Most Elusive Chart Pattern

As regular readers know, a “high tight flag” is an extremely rare, bullish chart pattern.

They typically form after an explosive move higher in a stock’s price.

Specifically, when looking for a high tight flag pattern, you need to see a stock climb 100% or more in less than eight weeks.

That’s one of the reasons this pattern is so rare… 

It’s just not that common for a stock to double in such a short period of time. However, it does happen.

Sometimes it’s due to a news or earnings release, but sometimes there’s seemingly no new information at all.

Either way, such a move will almost always be accompanied by a large increase in volume, and you’ll see that the rapid increase on the price chart starts to resemble a flagpole.

Raising the Flag

Once the stock has exploded higher and the flagpole has been planted, so to speak, we want to see the flag develop.

Ideally, you want to see a pullback of no more than 25%. Some traders will use a 20% range, but I find 25% works better for me.

This is crucial… 

The reason you want to see a limited pullback is that it signals that profit-taking is minimal and most buyers are holding their positions.

In other words, investors are expecting the stock to rise even further, so they’re holding on to the shares rather than taking profits on the big gain they already have.

If the stock can stay within that 25% range for two to six weeks, that consolidation will form the flag that sits atop the flagpole.

The Buy Signal

This brings us to the breakout phase of this price pattern. 

Once the stock breaks out of the flag part of the consolidation pattern to new highs, that’s the buy signal.

In other words, you want to buy it as soon as the stock makes a new high.

High tight flag breakouts can easily lead to big double- and triple-digit percentage moves for traders.

Sure, there is some risk involved in buying a stock that’s run so much higher in such a short amount of time.

However, the potential reward easily outweighs the risk if you’re using stop losses properly.

“Operation: FIRE Trader” 

Before I end today’s thoughts, I wanted to tell you about my breakthrough training event I’ve put together for this morning at 10 a.m. ET. 

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I’m officially shedding a light on this groundbreaking tool that’s infamously known for being “The #1 Best Performing Trading Strategy of All-Time…” 

In fact, based on a 1,012 page white paper study done by expert analysts…

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This is a HUGE deal… 

Which is why, given the circumstances…

Having a dependable and precision accurate strategy in your arsenal is more important than ever. 

I’ll reveal all the shocking details TODAY, Oct. 14th, at 10 a.m. ET

Again, this is my most anticipated event I’ve ever put on at Traders Agency…

So, you’ll definitely want to make sure you’re there to see all of the evidence I share. 

All you have to do is click here now to RSVP and secure your seat for “Operation: FIRE Trader.”

If you have more questions or comments, please send them to support@tradersagency.com.

Embrace the surge,

Ross Givens
Editor, Stock Surge Daily

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