Bear Pennant

The Bear Pennant is the bearish counterpart of the bull pennant. It follows a sharp downward move and consists of:

• A pole: steep decline on strong volume.
• A pennant: small, converging trendlines forming a tight triangle.
• Volume contracts during the pennant.
• Breakdown below support signals continuation of the downtrend.

The bear pennant reflects pause within a strong selloff:

• The pole shows aggressive selling and capitulation.
• Traders then pause, producing a tight consolidation with converging trendlines.
• Buyers show little strength; it’s mostly a pause for profit-taking and repositioning.
• Once the pennant breaks down, sellers press forward with renewed momentum.

Bulkowski’s findings:

• Downward break frequency: ~57–62%.
• Failure rate: ~15%.
• Average decline after breakout: ~19%.
• Target met rate: ~62%.
• Pullback frequency: ~55%.

Bear pennants tend to be slightly less reliable than bear flags but still signal continuation more often than reversal.

Entry: Short on breakdown below pennant support.

Stop loss: Above pennant resistance or recent swing high.

Targets: Pole height projected downward. Nearby support zones.

Invalidation: Sustained breakout above pennant resistance.

• Extended pennants: If the consolidation drags, it may morph into a symmetrical triangle.
• Low-volume breakdowns: Risk of failure if not supported by selling momentum.
• Oversold conditions: If the pole is already extremely steep, continuation odds may be reduced.

• If volume expands inside the pennant → suggests reversal energy.
• If the pennant slopes upward aggressively → may be a bear flag instead.
• If overall market context shifts bullish.