Bull flag and bear flag: what they are, and how to test them
A bull flag is a sharp rise, the pole, followed by a tight sideways or drifting pause, the flag, and then a close above the top of that pause. The bear flag is the mirror image. Here is the exact rule QuantLogic uses, and how to test both.
What it is
The pole is a fast move in a few bars. The flag is a short rest in a narrow band that does not give back much of the pole.
The pattern is complete only when a bar closes out of the flag in the pole's direction.
The exact rule QuantLogic uses
Bull flag breaking out, on one-minute bars. The bear flag is the mirror image.
- The pole: within at most 10 bars, price rose at least 30% of the average daily range (ATR), from the lowest low to the pole's last close.
- The flag: the next 5 to 20 bars stay within a band no wider than 15% of the ATR, and above the start of the pole.
- This bar is the first close above the flag's high.
When is it known? Known when the breakout bar closes. The average daily range is the mean of the last 14 regular sessions' ranges, known before the open.
Versions you can build
- Bull flag breaking out. A pole up, a tight flag, a close above it.
- Bear flag breaking down. A pole down, a tight flag, a close below it.
What to look at around it
In QuantLogic, every time the idea happened is laid out with the data points around it, so you can see where it held and where it didn't:
Traps when you test it
- Calling every pause a flag. The rule needs a real pole first and a tight flag after it.
- Drawing the flag after the breakout. Here its edges are the highs and lows of the bars before the breakout bar.
- Testing only bull flags in a rising market. Check bear flags too.
Build it and test it yourself
Open Bull flag breaking out in Build with QuantLogic. See every time it happened on NQ, ES, Gold or Crude since September 2025, check the long and the short side, add your own filters and run the luck test.
Nothing is proven until it holds live. We give no trading signals and no advice, we never hold your money or your accounts, and we never trade for you.
Questions
- How long can the flag last?
- Between 5 and 20 one-minute bars.
- Does the flag have to slope against the pole?
- No. It only has to stay in a narrow band; flat or slightly sloping both count.
Related setups
Setup library
Liquidity sweeps, break of structure, VWAP, the opening range and more, drawn and explained with the exact rule.
Tight range breakout
20 bars packed into a narrow band, then the first close out of it.
Break of structure
A close past the last swing high in an uptrend, or the last swing low in a downtrend.
V bottom and V top
A sharp drop fully taken back within a few bars (V bottom); V top is the mirror.
Wide-range bar
A bar at least twice as wide as the average of the 20 bars before it.
Educational content, not investment advice. Futures trading involves substantial risk of loss. See the risk disclosure.