Scalping the flag pattern

On December 21, 2010 | By | In Scalping Pattern

The flag pattern in forex scalping is understood as the limits of an upper or lower range pattern that could be trade to exploit benefits without taking big risks. They usually last for 30 or 60 minutes.

With this kind of pattern the trade strategies can be applied without the risk of big losses because the volatility is almost inexistent. There are no great expectations of big gains and the activity could be quiet unexciting.

In the graphic we can observe three flags registered in the USD/CHF pair; the first and the third are perfect to trade because they consist of a simple range without change of directionality. To exploit a flag it’s important to identify the moment when the price rises and becomes closer to the upper part of the flag, when the situation reverses is the moment to issue the sell orders. In this moment we can get profit of the established range pattern by entering small and quick different sell orders.

The same happens when the price falls and becomes closer to the lower limit of the flag, traders should wait until it begins to rise again.

Scalping the market trough the flags is an easy and secure technique but traders should be careful of not to be caught in the breakout when the flag pattern dissipates and the main trend appears.

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