Pennant

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The pennant chart pattern is a continuation pattern, This means the price is in consolidation period from the trend which is likely to continue when the pennant resistant or support has been broken.

In a bullish market the upwards trend will consolidate in a range of support and resistance which narrows with time until the resistance has broken continuing the trend.

Screen Shot 2016-09-03 at 19.45.45

In a bearish market the opposite happens, the down trend stops and consolidates in a narrowing range until the support is broken continuing the bearish trend.

Screen Shot 2016-09-03 at 19.45.38

Some traders trade in the range but it is best to wait for the break of the pennant resistant and support areas and the continuation of the trend for less risk and potentially more reward.

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