A Pennant Up is a continuation pattern that can form after a sudden, sharp rise in the stock price accompanied by high volume. It is in many ways a similar formation to a Flag Up except that its support and resistance lines converge to a point forming a small triangle. The volume decreases during the formation of this zone. On average, Pennants tend to form quicker than Flags.
Profit Target - can be measured by adding the height of the flagpole to the point of breakout.
Example - A daily chart of ZIXI showing a pennant up.
Trading Tip - Just like flags, pennants are best traded when they appear as tight formations. The tighter the pennant, the more reliable it is as an indicator of continuation of the price trend.