ZLBT Chats

Tuesday, May 26, 2009

0042 MOBIF Bull Flag or Pennant???


First thing first pls bear in mind this MOBIF trend is not very strong. Do not expect a breakout and prices flying to 20 sen or 30 sen level. ZL can assure you that would only happen in your dreams..... Realistically, a few sens or anywhere like 30% - 40% is achieveable. Anymore beyond is a bonus.
What is a PENNANT?

Pennants, which are similar to flags in terms of structure, have converging trendlines during their consolidation period and they last from one to three weeks. The volume at each period of the pennant is also important. The initial move must be met with large volume while the pennant should have weakening volume, followed by a large increase in volume during the breakout.

What is a FLAG?

Flags and pennants are among the most reliable of continuation patterns and only rarely produce a trend reversal. The only difference between the two patterns is that a flag resembles a parallelogram (or rectangle) marked by two parallel trend lines that tend to slope against the prevailing trend. The pennant, however, is identified by two converging trend lines and more horizontal which resembles a small symmetrical triangle. The important thing to remember is that they are both characterized by diminishing trade volume and though different, the measuring implications are the same for both patterns as demonstrated in the above illustrations.

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