Continuation Trading Patterns

When these continuation chart patterns are formed they confirm that the current commodity trend is going to continue heading in same direction.

These patterns are used by traders to spot half way points of the trend, this is because they form at halfway point of a trend.

There are four types:

• Ascending triangle
• Descending triangle
• Bull flag/pennant
• Bear flag/pennant

Ascending Triangle

The ascending triangle is formed in an up commodity trend and it shows that upward direction of the market is going to continue.

It shows that there is a resistance level that the buyers keep pushing each time moving it higher, and once it breaks commodity price will continue moving upward.

Overhead resistance temporarily prevents the commodities trading market from advancing higher, while the rising commodity trend line beneath the pattern signals that buyers are still present. An upside penetration of the upper line is a technical buy signal for a market breaking out from an ascending triangle.

Found within a Commodity Trading upwards trend, the ascending triangle forms as a consolidation period within the up commodity trend and indicates upside continuation will follow.

The market formed an ascending triangle during its up commodity trend which led to upside continuation. Buy point is when price clears the upper sloping line & the commodities market continues moving upward.

Descending Triangle

The descending triangle is formed in a down commodity trend and it shows that downwards direction of commodity price movement is going to continue.

It shows that there is a support level that the sellers keep pushing each time moving it lower, and once it breaks commodity price will continue heading downward.

The support temporarily prevents the commodities market from declining, while the descending sloping line above the pattern signals that the sellers are still present. A down-side penetration of the lower line is a technical sell signal for a market breaking down from a descending triangle, and this indicates selling will follow.

Found within a Commodities Trading downwards commodity trend, the descending triangle forms as a consolidation period within the down commodity trend & indicates downside continuation will follow.

Market formed a descending triangle during its down commodity trend which led to further selling & continuation of the downward commodities trend. The technical sell signal is when price breaks-out the lower horizontal sloping line as selling resumes to push the commodities trading market lower.

Bull Flag/Pennant

This commodity trading pattern forms what looks like a rectangle. The rectangle is formed by two parallel lines that act as support & resistance for the commodity price until the commodity price breaks out. Generally, the flag will not be formed perfectly flat but it will be formed sloping.

The bull flag is found within a Commodity upward trend. In this continuation pattern where the commodities trading market retraces slightly, it is therefore a slight retracement with narrow commodity price action that has a slight downwards tilt. The technical buy point is when price penetrates the upper line of the flag. The flag portion has highs and lows which can be connected by small lines which are parallel, giving it what looks like a small channel.

The pennant occurs at halfway point of a bullish upward commodity trend and after a break out a similar move equivalent to the height of the flagpole is expected.

The bull pennant above was just a resting period as the commodities trading market gathered strength to break out & move higher. The continuation trading signal was confirmed as a upper line was broken to the upside.

Bear Flag/Pennant

This flag is found in a Commodity Trading downwards trend. The bear flag is a continuation pattern where the price retraces slightly with a narrow price action that has a slight upward tilt. The technical sell point is when price penetrates the lower line of the inverted flag. The pennant portion has highs and lows which can be connected by small lines which are parallel, giving it what looks like a small channel.

The bear pennant above was just a resting period for the commodities trading market prior to more selling. The continuation signal was completed as lower line was broken to the down-side.