From Hard Assets Investor:
Investors often complain about being blindsided by sudden shifts in market momentum. Well investors, take a gander at the crude oil futures chart and see if you can see a big red momentum flag.
Notice how the daily highs and lows scored by the NYMEX nearby contract have gotten lower over the past month? This is a classic "flag" formation (the flag's formed by two trend lines, one connecting the recent highs, the other the recent lows). A flag formation usually is a pause in a continuing trend that allows a market to gather strength for another leg.
Usually. But not always. Sometimes...
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