Trading term

What is Pennant?

A pennant is a short-term continuation pattern: a sharp price move (the 'pole') followed by a small converging triangle where price coils into an ever-tighter range before breaking out in the pole's direction. It's a flag's close cousin, differing only in the shape of the pause.

A pennant, like a flag, starts with a pole — a steep, high-momentum move. Then, instead of a parallel channel, price consolidates into a small symmetrical triangle: lower highs and higher lows converging to a point, like a tiny pennant on the flagpole. The range tightens as buyers and sellers briefly balance, volatility contracts, and volume typically dries up during the coil before surging on the breakout.

Pennants are short-lived continuation patterns. The breakout — a decisive close out of the converging triangle in the pole's direction — is the trigger, and the classic target is a 'measured move' projecting the pole's height from the breakout. Because a pennant looks like a small symmetrical triangle, the key distinction is context: a pennant is brief and follows a sharp pole, while a symmetrical triangle is larger and stands alone.