Pennant: my loyal friend in the world of crypto trading

How many times have I already burned myself by ignoring this damn pattern! Pennant is not just lines on a chart, it's a real guide for a trader like me. After many years of trial and error, I have finally learned to appreciate it.

When the market consolidates after a powerful surge — this is not a time for panic, but a signal to gather and prepare for the next move. I especially love this tense pause before the second act of the trend, when everyone holds their breath in anticipation.

What is a pennant really?

This is not just a picture from a textbook — it is a living organism of the market! It forms when, after a sharp rise or fall, the price begins to bounce around in a narrowing corridor. Most "experts" will tell you that this is a classic continuation pattern, but I have seen it deceive even experienced traders.

The most important thing is the flagpole. Without a strong impulse move before the formation of the triangle, it is not a pennant, but just consolidation. One must see the aggressive play of large players before the formation — this is the key to correct interpretation.

When the volume drops during the formation of a pattern — everyone holds their breath, waiting. And then BAM! — a breakout and an explosion of volume. That's where real money is made! But only if you managed to enter in time, not when all the media "analysts" are already blaring about the breakout.

Trading by Pennant: My Approach

I have tried a bunch of strategies, but I am currently using three:

1. Entering at the very breakthrough of the border is risky but potentially the most profitable.
2. Entering after breaking the extreme is safer, but you miss part of the movement.
3. Entering on a pullback after a breakout is my favorite method, although often the pullback does not come, and the train leaves without you.

No matter what Bukowski wrote in his encyclopedia, 54% of failed breakthroughs is complete nonsense! In my experience, if you know what to look for, the Pennant triggers much more often. Yes, I have burned myself at times, but when you trade with proper risk management, it's not a problem.

Most trading platforms try to sell newcomers complex indicators and systems, but the classic Pennant works better than any trendy algorithm. And remember — the pattern can complete in a week or in three, don’t wait forever!

Bullish or bearish - it doesn't matter. The technique is the same, only the direction changes. The main thing is not to miss the aggressive initial impulse and to wait for a quality breakout.

Don't believe those who say that technical analysis doesn't work. The Pennant is living proof to the contrary. It's just that most people can't wait and break down too early, and then blame the market. I did the same until I learned discipline.