A pennant consists of a flagpole (sharp rally) followed by a symmetrical triangle consolidation. The triangle's range contracts with volume declining; a breakout above the upper boundary on volume confirms trend continuation.
Brief consolidation after a sharp advance. Bullish momentum pauses; bulls and bears contest within a narrowing range, redistributing positions. The breakout signals momentum resumption and the advance continues.
Enter long on a high-volume breakout above the triangle's upper boundary (win rate 66%). Stop-loss below the triangle's last low. Target = flagpole length added to the breakout point.
Pennant consolidation is usually shorter than a flag — typically under 15 candles. Volume contraction is essential during consolidation; expansion is required on the breakout.