What is Bearish Pennant Pattern ?
The Bearish Pennant is a bearish continuation pattern often observed in financial markets, including cryptocurrencies. It typically forms after a significant downward price move, represented by a flagpole, followed by a brief period of consolidation marked by narrowing price fluctuations, creating a pennant shape.
Traders and investors interpret the Bearish Pennant as a signal of potential further downside in the asset's price. The pattern suggests that market participants are taking a breather after the initial decline, and the prevailing downtrend is likely to resume once the consolidation phase concludes.
To identify a Bearish Pennant, traders look for decreasing trading volumes during the consolidation, indicating a potential decrease in buying interest.
