Binary Option Trading - Pennants and Continuation Patterns

Some articles we publish tell about how to pick patterns out from analytical charts in order to detect at what point a price will change its movement or if we believe it to remain the same. Continuation pattern is one of the most important to look for; one of the core indicators inside a continuation pattern which helps to indicate the price movement is a pennant. Let’s havea little more talk about those two things.

Before our talk about pennants we should clarify the difference between the two types of pennants, continuation and reversing ones and try to understand what outcome you will have after you follow each of them. A continuation pattern means that the price of an asset is breaking a consolidation area in the direction similar to the previous trend. And a reversal pattern is the one having a trend which is moving in a different direction after having broken out of the consolidation area.

Pennants are formed when we see a nearly vertical triangular patterns price movement, usually after some drastic up (the drastic move establishes the pennant pole and that nearly vertical move makes its flag). A continuation will indicate a bullish trend will be on. In this case it is advisable to buy call options only. It is worth doing after you see the pennant is forming. You should always keep in mind prices usually travel very fast after they brake a consolidation area of some continuation pattern.

The best thing about a pennant as an indicator is the fact you only have to measure the move in order to get the continuation pattern confirmation.

So, as soon as you get used to pennants, you will see they are a great tool which helps you spot continuation patterns. An as soon as they are spotted, get ready for buying call options.

More related articles:

 15 Minute Binary Options Strategy
It is not always easy to find a trading style or strategy which works for you. In fact, for most traders the right approach is unique to them simply because everyone has different risk factors. The...
 3 Profitable Ichimoku Strategies Tradinformed
Ichimoku trading strategies are simplified with no grounded analysis or judgement required. It is considered to be a trading pattern designed in Japan. The system has been created to help market pl...
 5 Day Trading Secrets
The day trading market method is basically concerned with short lasting positions, generally, a trader buys and sells stocks simultaneously. The stock options trading strategy implementation instru...
 5 Minute Binary Options Strategy
Learning to trade in binary options is not an easy task. Certainly anyone can start trading, but, to generate consistent profits you will need to understand the principles of this trading and devel...
 60 Second Binary Options Strategy
There are many different options when choosing a 60 second binary options strategy. However, one of the most successful approaches has been to trade in sets of three. This will help you to identify...
 60 Second Binary Options Strategy
One minute is not a lot of time in which to correctly predict the movement of a price! You will barely have completed your trade and it will have expired. In order to use a 60 second binary options...
TOPICS: Pennants  Continuation 
Binary Option Auto Trading





100% Secure