What is Bear Flag (Technical Formation)?

A bear flag is a technical charting pattern shaped like a flag that often signals bearish momentum and a decrease in price. Bear flags mimic the structure of a bull flag, only inverted. With a bear flag, the flagpole is formed during a significant drop in price that traders are often not expecting, while the flag itself is formed during a brief period of consolidation that usually signals a downward continuation in price. Bear flags, like all technical formations, can sometimes be negated and fail to produce the results they may have originally indicated.