Pauses, not reversals
Continuation patterns are consolidations where a trend catches its breath before resuming. A 'flag' is a short counter-trend drift after a sharp move; a 'pennant' is a small symmetrical triangle; both typically resolve in the direction of the prior trend.
Triangles (ascending, descending, symmetrical) show buyers and sellers compressing toward a decision. The tell is the breakout — direction plus volume — not the shape alone.
Anatomy of a flag
The cleanest continuation is a flag: a sharp move (the 'pole'), then a short, tight drift slightly against it on shrinking volume (the 'flag'), then a resumption in the original direction. Pennants and small triangles are cousins — all are pauses where a trend catches its breath. The tighter and quieter the consolidation, the more reliable the eventual break.
Trade the break, not the shape
The pattern is only a setup; the trade is the breakout — the resumption in the trend direction, ideally on a volume expansion. Location matters: a flag right after the first leg off a base is higher quality than the third flag in an extended, tired run. Measure the pole for a rough target, but weight the volume signature over the tidy geometry.