Bear flag

A bear flag takes shape in two visible parts: a steep, high-volume decline called the flagpole, followed by a brief pause where price drifts sideways or slightly upward in a narrow, parallel channel resembling a flag on a pole. That pause reflects short-term profit-taking or hesitation rather than a genuine reversal, and it typically unfolds over a few days to about a week on daily charts.

Traders watch for the flag's slope to angle gently against the prior downtrend and for trading volume to shrink during the consolidation, since fading volume suggests sellers are merely regrouping rather than losing control. The pattern is considered confirmed once price breaks below the flag's lower boundary, ideally on renewed volume, at which point many traders project a further decline roughly equal to the flagpole's height to estimate a downside target.

Bear flags appear across timeframes and markets, and crypto's volatility makes them common on Bitcoin and other major assets during sharp sell-offs. Because the pattern can fail, particularly in choppy or low-volume conditions, or if price pushes back above the flag's upper line, most traders pair it with volume, momentum indicators like RSI, or candlestick confirmation before opening a short position. It is read as the mirror image of a bull flag, which signals continuation to the upside instead.