Although the next chart may seem garbled, it is actually detailing recent simple bull and bear retracement patterns on the 15-minute chart. This serves as a great educational example:

I also call bull and bear flags “lightning bolts,” though technically I should only call bear flags lightning bolt patterns because of the equivalent downwards thrusts.

Recap: Bull and Bear Flags call for a “measured move” which sets up a key trade based on the price action alone. They are some of my favorite patterns in technical analysis due to their simplicity, ease of stop placement, and exact target location.

Notice the first bear flag which is a sharp retracement against the momentum/price downthrust.

An ascending triangle (which has slightly better odds of resolving/breaking out to the upside) formed which indeed did get a price/momentum up-thrust, which was corrected by a near perfect bull flag (around 2:00 Jan 10).

Price then impulsed down with today’s opening gap and then continued to trend lower all day. A nice and near perfect bear flag formed into the close.

Here’s an isolated example of today’s 5-minute chart:

This example was a more 45 degree angle flag, but the measured move and ejection (breakout) from the retracement (especially from resistance at the declining 50 period moving average) was near ideal.

Once you begin to understand these patterns, they literally leap off the chart at you and call your attention to them when they’re forming.

Besides that, I think they’re fun!