# Pennant

A Pennant forms right after a strong price move. Think of it like a mini-triangle. Price blasts in one direction (the pole), then consolidates in a small, converging range (the pennant). When price breaks out of that narrow range, it often continues in the original direction.

<figure><img src="/files/huIqKhw78sdm3J4KBBlW" alt=""><figcaption></figcaption></figure>

### How to Identify

1. **Flagpole.** Look for a sharp move up or down.
2. **Pennant Shape.** Price starts narrowing into a tiny triangle.
3. **Volume.** Often fades during the pennant, then may pick up on the breakout.

### How to Use

<figure><img src="/files/k5NJ68XpIUiRbwElEEnx" alt=""><figcaption></figcaption></figure>

* **Entry**: wait for a clean break past the pennant. Many jump in right as the breakout candle closes.
* **Stop**: place it inside or just outside the pennant to manage risk if price whips back.
* **Target**: measure the length of the flagpole and project that from the breakout to get a possible target.

### Pro Tips

* Confirm the breakout with momentum or volume.
* Watch for fakeouts if the pennant is too choppy or if volume is absent.
* Combine with other signals, like support/resistance zones, for extra clarity.

### Exercise

Pull up a chart that shows a rapid move followed by a small converging pattern. Mark the flagpole and draw lines around the pennant. Imagine entering on a breakout and placing stops inside the pennant. Use backtesting to see if price reaches the projected target. Repeat across different markets and note your results.


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