Bearish flag pattern is the most common trend continuation pattern. As you can see in the illustration above, the market was trending down creating a small pullback and then continued down. The supply zone could be drawn where the small pullback occurred.
Price left the supply zone with strong bearish momentum and then the corrective phase started forming a flag pattern.
Every push to the upside is closer to the supply zone.
Every push down attracts more sellers. The third push to the upside penetrates into the supply zone in order to trigger the institutional sell limit orders and early sellers' stop losses.
This cause a massive bearish move breaking the last main structural point.
A pullback back to this zone is a great short opportunity if you missed the first move after the triggeration of the limit orders.
